The Crime Control Act did a few things,” says the Virginia-based defense attorney David Smith, author of the legal treatise Prosecution and Defense of Forfeiture Cases. “First, it corrected some poor drafting in the earlier laws. Second, it created two federal forfeiture funds, one in the Justice Department and one in the Treasury. And most important, it included an earmarking provision that gave forfeiture proceeds back to local law enforcement agencies that helped in a federal forfeiture.”
This last bit was key. “The thinking was that this would motivate police agencies to use the forfeiture provisions,” Smith says. “They were right. It also basically made law enforcement an interest group. They directly benefited from the law. Since it was passed, they’ve fought hard to keep it and strengthen it.”
The 1984 law lowered the bar for civil forfeiture. To seize property, the government had only to show probable cause to believe that it was connected to drug activity, or the same standard cops use to obtain search warrants. The state was allowed to use hearsay evidence—meaning a federal agent could testify that a drug informant told him a car or home was used in a drug transaction—but property owners were barred from using hearsay, and couldn’t even cross-examine some of the government’s witnesses. Informants, while being protected from scrutiny, were incentivized monetarily: According to the law, snitches could receive as much as one-quarter of the bounty, up to $50,000 per case.
According to a 1992 Cato Institute study examining the early results of the Comprehensive Crime Control Act, total federal forfeiture revenues increased by 1,500 percent between 1985 and 1991. The Justice Department’s forfeiture fund (which doesn’t include forfeitures from customs agents) jumped from $27 million in 1985 to $644 million in 1991; by 1996 it crossed the $1 billion line, and as of 2008 assets had increased to $3.1 billion. According to the government’s own data, less than 20 percent of federal seizures involved property whose owners were ever prosecuted.
More than 80 percent of federal seizures are never challenged in court, according to Smith. To supporters of forfeiture, this statistic is an indication of the owners’ guilt, but opponents argue it simply reflects the fact that in many cases the property was worth less than the legal costs of trying to get it back. Under the 1984 law, forfeiture defendants can’t be provided with a court-appointed attorney, meaning an innocent property owner without significant means would have to find a lawyer willing to take his case for free or in exchange for a portion of the property should he succeed in winning it back. And to even get a day in court, owners were forced to post a bond equal to 10 percent of the value of their seized property.
The average Drug Enforcement Administration (DEA) property seizure in 1998 was worth about $25,000. In 2000 a Justice Department source told the PBS series Frontline that this figure was also the cutoff under which most forfeiture attorneys advised clients that their cases wouldn’t be worth pursuing. So a law aimed at denying drug kingpins their ill-gotten millions ended up affecting mostly those with so little loot it didn’t even make sense to hire an attorney to win it back.
Police gradually came to view asset forfeiture as not just a way to minimize drug profits, or even to fill their own coffers, but as a tool to enforce maximum compliance on non-criminals. In one highly publicized example from the 1990s, Jason Brice nearly lost the motel he had bought and renovated in a high-crime area of Houston. At the request of local authorities, Brice hired private security, allowed police to patrol his property (at some cost to his business), and spent tens of thousands of dollars in other measures to prevent drug activity on the premises. But when local police asked Brice to raise his rates to deter criminals, he refused, saying it would put him out of business. Stepped up police harassment of his customers caused Brice to eventually terminate the agreement that had allowed them latitude on his property. In less than a month, local and federal officials tried to seize Brice’s motel on the grounds that he was aware of drug dealing taking place there. Brice eventually won, but only after an expensive, drawn-out legal battle.
By the late 1990s, stories such as Brice’s finally moved Congress to act. After a series of emotional hearings in 2000, Congress passed the Civil Asset Forfeiture Reform Act (CAFRA), authored by Rep. Henry Hyde (R-Ill.). The bill raised the federal government’s burden of proof in forfeiture cases from probable cause to a preponderance of the evidence, the same standard as in other civil cases. It barred the government from using hearsay and allowed owners who won forfeiture challenges to obtain reimbursement for legal expenses.
The bill wasn’t perfect. Seizures made by customs agents, as opposed to the DEA or FBI, would still be governed by the old rules. Hyde (who died in 2007) wanted an even heavier burden of proof for the government, the “beyond a reasonable doubt” standard used in criminal cases. That didn’t pass. Under CAFRA, the federal government could still take your property without proving beyond a reasonable doubt that any crime was committed, much less that you yourself had committed one. But at least the reforms made the process a bit more difficult.
Problem was, the 1984 law had already spawned dozens of imitators on the state level, and CAFRA applied only to the feds. Forfeiture had been sending money to police departments and prosecutors’ offices for 16 years, so even in the few states that passed laws to make the process more fair, officials found ways around them. Once the authorities have a license to steal, it turns out to be very difficult to revoke.
Present Punishment for Future Crimes
On February 4, 2009, Anthony Smelley got his first hearing before an Indiana judge. Smelley’s attorney, David Kenninger, filed a motion asking for summary judgment against the county, citing a letter from a Detroit law firm stating that the seized money indeed came from an accident settlement, not a drug transaction. Kenninger also argued that because there were no drugs in Smelley’s car, the state had failed to show the required “nexus” between the cash and illegal activity. Putnam County Circuit Court Judge Matthew Headley seemed to agree, hitting Christopher Gambill, who represented Putnam County, with some tough questions. That’s when Gambill made an argument that was remarkable even for a forfeiture case.
“You have not alleged that this person was dealing in drugs, right?” Judge Headley said.
“No,” Gambill responded. “We alleged this money was being transported for the purpose of being used to be involved in a drug transaction.”
Incredibly, Gambill was arguing that the county could seize Smelley’s money for a crime that hadn’t yet been committed. Asked in a phone interview to clarify, Gambill stands by the general principle. “I can’t respond specifically to that case,” he says, “but yes, under the state forfeiture statute, we can seize money if we can show that it was intended for use in a drug transaction at a later date.” (Smelley himself refused to be interviewed for this article.)
The New York–based attorney Steven Kessler, author of the legal treatise Civil and Criminal Forfeiture: Federal and State Practice, says he has never heard the “future crimes” argument. “Can you imagine any judge in America allowing an argument like that to stand?” Kessler says. “It’s obscene. It’s like something out of that movie Minority Report. We don’t punish people for crimes they haven’t yet committed.”
Smelley’s fight for his money would only get more bizarre. At the conclusion of the February hearing, Judge Headley temporarily granted the motion for summary judgment, ordering the county to return the money. But there was a catch. Under Indiana law, the county had an additional 10 days to amend its complaint to show a connection between the seized property and illegal activity. If after that 10-day period the state didn’t amend its complaint, or if the judge found the amendments insufficient, Smelley could retrieve his cash and be on his way.
But Headley would never rule on the amended complaint. Days after issuing summary judgment, Headley pulled himself off the case without explanation. Smelley’s case was then batted around Indiana county courts for months, before finally ending up in front of Special Judge David Bolk. On August 18, more than seven months after Smelley’s money was seized, Bolk overturned Headley’s summary judgment. The opinion was curt, and didn’t offer an explanation. Bolk ordered a civil forfeiture trial for November 13. The trial was then postponed again until January 29, 2010, due to congestion in the court system. That means Putnam County will have held Smelley’s money for more than a year before giving him the opportunity to argue that he should get it back.
‘Make the Bad Guys Pay!’
A survey of state and federal forfeiture since 2000 shows that CAFRA hasn’t stopped the exponential growth of government asset seizure. Adjusted for inflation, the Justice Department’s asset forfeiture fund, which includes proceeds from forfeitures carried out by all federal agencies except Immigration and Customs Enforcement, grew from $1.3 billion in 2001 to $3.1 billion in 2008. (The total includes some money left over from previous years, but according to Smith, almost all of the money is doled out to local and federal agencies on an annual basis.) National Public Radio has reported that between 2003 and 2007, the amount of money seized by local law enforcement agencies enrolled in the federal forfeiture program tripled from $567 million to $1.6 billion. That doesn’t include property seized by local law enforcement agencies without involving federal authorities.