Property Rights

U.S. Attorney General Puts the Brakes on Federal Forfeiture of Local Cases

Update: The “equitable sharing” program described below has been restarted 2.5 months later, and local police agencies are once again being given significant amounts of revenue from seized property.

U.S. Attorney General announced today that his office would no longer allow state and local law enforcement officials to participate in the Equitable Sharing civil asset forfeiture program, with limited exceptions.

Under this program, police officers could transfer a civil asset forfeiture case to federal agents, where lower legal standards made it easier to forfeit—and cash in on—the seized assets. 80% of the resulting revenue would flow back to the state or local agency, creating an easy and enticing avenue for generating funds for the department.

This “policing for profit” was the highlight of an Institute for Justice report that revealed the prevalence of this problematic violation of property rights. The Washington Post also recently published a lengthy investigation into the issue, helping to bring it to the fore of public consciousness.

Utah has a direct and controversial connection to the issue of civil asset forfeiture. In 2000, Utah voters passed Initiative B which curtailed civil asset forfeiture by enacting strict limits on when it could be used. Importantly, it included several property rights protections and limited when prosecutors in Utah could transfer a case to the federal government. No longer could police departments in Utah directly benefit from the property they seized.

That changed in 2004 under some minor revisions to civil asset forfeiture law in Utah, freeing up revenue from the Equitable Sharing Program to once again flow to police departments, albeit through an intermediary. Revenue was directed to the Commission on Criminal and Juvenile Justice, and then disbursed as grants to departments.

Other than this change, civil asset forfeiture law remained untouched until 2013, when the Attorney General’s office under the leadership of John Swallow deceived the legislature into gutting property rights protections and removing roadblocks that prevented prosecutors from transferring cases to the federal government. A Libertas Institute investigation revealed these changes, and shocked legislators who learned that they had been duped.

Model legislation offered by Libertas Institute was unanimously enacted into law, restoring private property protections and imposing court oversight on prosecutors who desired to transfer cases to the federal government.

Today’s announcement by Eric Holder is a welcome one, though it should be noted that it is an internal decision. Changes in federal law are still needed to ensure that the program is legally terminated, lest one of Holder’s successors decide they wish to resume it.

Libertas Institute has offered further model legislation to impose transparency and reporting requirements on forfeiture cases, so the public can better learn how and why property is being seized in the state. This data is important in order to enact smarter public policy and illuminate areas of the law that may merit additional reform.