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Crimping Cops’ Property Seizure Business

detail of the Robert F. Kennedy Department of Justice Building
photo by John Taylor

Among other worthy features, such as keeping the federal government operating and reining in IRS attacks on political speech, the recently passed federal budget puts a significant crimp in law enforcement’s side business of seizing the public’s property for its own benefit.

As I observed last summer, using a police badge as a license to confiscate property from citizens who have not been convicted of or, in many cases, even been charged with any crime was an open invitation to abuse. Now that countless videos have shown that police departments are not entirely populated by angels and saints, Congress has finally been inspired to act.

The action in this instance was a cut to the Justice Department’s budget that led the department to suspend the “equitable sharing” program that helped make such seizures lucrative for local police.

Equitable sharing allowed local law enforcement to keep up to 80 percent of the revenue generated by forfeiture cases that they brought under the Justice Department’s federal umbrella. According to The National Law Review, over $5 billion has been distributed to state law enforcement this way since the equitable sharing program began in 1984. Because such seizures often went straight into local agencies’ budgets, local law enforcement had every reason to fight efforts to repeal or reform property forfeiture law when such attempts arose at the local or state level.

Of course, I was not the only person to point out the inherent conflicts of interest embedded in this system. The practice has become increasingly contentious, especially as major national media outlets draw increased attention to it. In the fall of 2014, The Washington Post ran a series of articles examining the practice in detail. That report, in turn, inspired comedian John Oliver to focus on civil forfeiture in a segment on his show, “Last Week Tonight.” The year prior, The New Yorker printed its own examination of the practice, with an equally critical conclusion.

There has not been a lot of reform at the state level, partly because forfeitures would have continued anyway under the federal sharing program, and partly because law enforcement has lobbied so hard to keep the gravy train running. As Vanita Gupta, of the American Civil Liberties Union, told The New Yorker, “What stands out to me is the nature of how pervasive and dependent police really are on civil-asset forfeiture - it’s their bread and butter - and, therefore, how difficult it is to engage in reform.”

Yet what failed from the bottom up may succeed from the top down. Now that equitable sharing does not fit within the Justice Department’s budget, civil asset forfeiture may become a much less lucrative funding source for local agencies. Federal forfeiture laws are typically more permissive than state policies, and some states do not have programs at all. Many state and local agencies are facing major reductions in their legal right to hang on to seized assets, and thus major reductions in their revenue overall.

Unsurprisingly, law enforcement organizations are not happy about the end of equitable sharing. Several have issued statements suggesting that this change will hurt law enforcement officers’ ability to keep the public safe. But reformers have pointed out that the Justice Department’s decision does not actually affect the ability to seize goods from suspected criminals at all. The only difference is that agencies have less chance to keep what they confiscate - which ought to go a considerable distance toward eliminating questionable seizures.

Justice’s equitable sharing program is suspended, not scrapped, at least for the time being. The department’s announcement suggested that “should the budget picture improve,” it might resume payments in the future. But at least the suspension provides an opportunity to help law enforcement kick its addiction to seized money. It is hard to have clean cops when we make it so tempting for them to engage in dirty tactics.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book, Looking Ahead: Life, Family, Wealth and Business After 55. His contributions include Chapter 1, “Looking Ahead When Youth Is Behind Us,” and Chapter 4, “The Family Business.” Larry was also among the authors of the firm’s book The High Achiever’s Guide To Wealth.

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