DRUG TASK FORCE FACES AUDIT CRITICAL

At Issue Is Where The Drug Task Force Should Deposit Cash And The
Proceeds From The Sale Of Other Property Seized From Drug Dealers.

MUNCIE -- The Muncie-Delaware County Drug Task Force is playing a game
of keep away that uses money instead of a ball, and the state of
Indiana is the monkey in the middle.

Going back to at least 1999, the DTF has ignored a state law requiring
cash and proceeds from the sale of other property seized from drug
dealers to be deposited in the general fund of the governmental unit
employing the DTF officers, according to the State Board of Accounts.

Any excess money remaining after the reimbursement of law enforcement
costs is supposed to be transferred from the local general fund to the
state treasurer for deposit in the state's common school fund.

In response, Muncie police Sgt. Jess Neal, head of the DTF, said in an
interview that most asset forfeitures here involving drug-related
crimes go through the local courts.

He provided as an example the case of State vs. Malcom X Crim, 20,
2013 E. Park Ave.

In August, DTF and the county prosecutor's office obtained a default
judgment of $312 against Crim (a suspected cocaine dealer) signed by
Delaware Circuit Court 4 Judge John Feick. The judge ordered DTF to
deliver the $312 to the "City of Muncie General Fund, Account #
231-204-39071."

But that account number, as well as account # 227-00-367011, are DTF
accounts, not city general fund accounts, the State Board of Accounts
says. For years, the DTF has been obtaining court orders to forfeit
assets seized from drug dealers to the two DTF accounts, also known as
the MPD Drug Interdiction Fund and the MPD Drug Task Force Forfeiture
Fund, which the court orders falsely call city of Muncie general fund
accounts, the state says.

All city of Muncie general fund accounts begin with the numbers
101.

"The DTF is their own little entity," said city Controller Mary Ann
Kratochvil. "They run their own show. They take care of their own
budget. They're upstanding guys, and to my knowledge, there has been
no abuse, just nitpicky stuff like you see in these audits. Their
checkbook is not always balanced to the penny, but that's because
they're out on the streets covering each other's backs; they're not
accountants. The worst thing I ever saw them do was donate to charity.
They may cross the line with their donations."

Last year, $68,931 seized from drug dealers was receipted into DTF
accounts, compared to $49,116 so far this year.

"The DTF can't survive without dope dealers' money," Neal
said.

For many years, the drug task force received an federal grant of
$77,000, but that award has been cut by more than half in the past
several years because of other federal spending priorities, such as
homeland security and the war in Iraq, Neal said.

"We've had to make adjustments, be more aggressive with asset
forfeitures, more aggressive targeting bank accounts, vehicles,
tangible property, things we can sell in auctions," Neal said. "The
money goes for equipment essential to running a drug task force --
vehicles, cell phones, recording devices, guns and vests for the SWAT
team, drug dogs."

Neal can't recall a time that the DTF ever forfeited surplus funds to
the state treasurer for deposit in the common school fund.

"If we can't justify the law enforcement man-hours in a case, we send
the money to the feds," he said.

For example, last year, DTF seized half a pound of marijuana, three
firearms and $234,000 in suspected drug money hidden in a residence at
1107 N. Central Ave., the home of suspect Ralph "Jake" Evans's girlfriend.

"If the seizure is turned over to the feds, they take 20 percent and
return 80 percent under their Equitable Sharing Agreement," said
Delaware County Prosecutor Mark McKinney.

Permissible uses of that money by DTF include payments to informants,
buy money, reward money, law enforcement training, and purchase of
body armor, firearms, uniforms, supplies, office space, furniture,
safes and file cabinets.

(The DTF has not yet received the federally forfeited cash from the
Evans case. The money will be split among the local police departments
that participate in the DTF).

McKinney had this to say about State Board of Accounts' audits of DTF:
"With regard to their concern about the money not going into the
general fund, I do not understand that issue. The court orders
specifically state that the funds go to the general fund of the city.
There is even a specific line item for the receipt of those funds."

Donations questioned

In addition to that issue, the latest State Board of Accounts audit
calls attention to disbursements from DTF accounts to the Muncie
Pirates baseball team, the Yorktown youth football drug awareness
program and other donations, as well as funding for the city gym.
"Their workout room is out of this world," Kratochvil said. "It's a
very nice facility."

Neal said of the workout room in the basement of city hall: "For its
size, it's one of the best in the state. It was purchased by our local
dope dealers. We use their money to get in shape so we can chase them
around."

Neal acknowledged that rules prohibit spending federally forfeited
drug revenue for charitable purposes.

But that doesn't stop him from spending locally forfeited drug profits
on charity, even though Kratochvil says local governments shouldn't do
so.

"If the State Board of Accounts has a problem with that, I don't know
what to say," Neal said. "I don't mind getting written up for giving
to kids. I wish I could give more."

DTF once spent $1,250 to feed 125 local youths at Texas
Roadhouse.

The State Board of Accounts also questions whether the DTF's
procedures keep city council from deciding how assets seized from drug
dealers are spent each year. City Council President Bill Shroyer said
he believed city council created the two DTF accounts in question many
years ago.

No contract for payments

The latest audit of DTF, published this past summer, also questions
DTF's payment of 25 percent of property seized from drug dealers to
full-time deputy prosecutors without a written contract. "Payments
made or received for contractual services should be supported by a
written contract," the audit states.

In an interview, McKinney said deputy prosecutors handled asset
forfeitures for 25 percent of the judgments. The deputy prosecutors
who handled those proceedings in recent years were Louis Denney, then
McKinney and now Eric Hoffman.

In the past five years, full-time deputy prosecutors have been paid an
additional $17,887, $24,486, $11,082, $4,174 and $24,708 to handle
drug-crime asset forfeitures.

"They (the state) have never before, in 20 years, raised a concern
about a contract between the city and the prosecutor," McKinney said.
"The statute authorizes the prosecutor to pursue forfeiture actions on
behalf of law enforcement. I have not seen any authority that would
require a contract such as they are recommending, but certainly would
be open to one if that was required."

The State Board of Accounts cited chapter 7 of the Accounting and
Uniform Compliance Guidelines Manual for Cities and Towns as its authority.

Asset forfeiture is a valuable tool in the fight against
drugs.

"We try to seize every asset that we can under the law," McKinney
said. "Cars and houses can be a problem because many times there will
be too much money owed. In those situations, the asset goes to the
lien holder. We make every effort ... to dig up every asset that we
can find. We took a lot of money and personal property from Tyrone
Buchanan, Sam Caldwell, Terry Pounds, Ralph Rowe, Dantley Layne and
many others."

Where such proceeds should be deposited is a subject likely to come up
again in next year's audit of the DTF.