To Protect and Collect

Taking Cash Into Custody

A Special Report On Police And Drug Money Seizures

ACROSS U.S., POLICE DODGE STATE SEIZURE LAWS

Police and highway patrols across the country are evading state laws to
improperly keep millions of dollars in cash and property seized in drug
busts and traffic stops.

Most states don't want law enforcement agencies to profit so easily from
such confiscations -- they see it as a dangerous conflict of interest. For
that reason, they have passed laws blocking seized property from going
directly back to police, and many states designate seizures to be used for
other purposes, such as education.

But a yearlong examination by The Kansas City Star reveals that police
agencies in every one of more than two dozen states checked by the
newspaper have used federal law enforcement to circumvent their own laws
and keep most of that money for themselves.

It works this way: When police seize money, they call a federal agency
instead of going to state court to confiscate it. An agency such as the
Drug Enforcement Administration accepts the seizure, making it a federal
case. The DEA keeps a cut of the money and returns the rest to police.
State courts -- and their generally more-restrictive forfeiture laws -- are
bypassed altogether.

Law enforcement says that's not illegal and that without the money, police
would be handcuffed in fighting crime. But millions of dollars that
lawmakers in some states have designated for education, drug treatment
programs and other purposes instead end up back in the hands of police.

For example:

A North Carolina State Highway Patrol trooper stopped a driver last year on
Interstate 95 for tailgating. A police dog signaled drugs were in the
Toyota, where troopers found $105,700 and two grams of marijuana. The
driver denied owning either the drugs or the money. The highway patrol
gave[ it ] the money to the DEA, which returned more than $80,000 to the
state patrol, even though North Carolina law generally requires sending
seized money to education.

In June a Georgia trooper stopped a 1996 Monte Carlo for speeding on I-95.
After the driver and passengers gave conflicting stories, the trooper
searched the car and found a hidden compartment containing $7,000, which
the driver said was from savings.

The patrol turned over the money to the DEA, which in January returned
$5,440 to the patrol. Under Georgia law forfeited money should go to the
state's general fund.

In 1996, the Missouri Highway Patrol stopped a Volkswagen Golf for
speeding, searched it because the occupants seemed suspicious and found
$24,000. No drugs were found and no one claimed the money. The patrol gave
it to the DEA to be forfeited, the legal term for confiscation.

(The case took a bizarre turn last year when a family that bought the car
at auction discovered an additional $82,000 in the gas tank. The DEA took
that money, too.)

Missouri law sends forfeiture money to a public school fund.

Beyond the money diverted from public funds, critics are just as troubled
by the weakening of a basic American civil liberty -- the Bill of Rights
protection against improper search and seizure.

Owners who want to recover seized property usually face a much tougher road
in federal court than they would under their own state laws. That continues
despite a new federal law passed last month that will place some limits on
forfeiture.

The federal hand-offs, critics say, also create an opportunity for police
to profit from their own actions. Indeed, they trace an increasing outcry
over aggressive or illegal searches by police nationwide back to the profit
motive.

"If you think that by conducting an illegal search and seizing people on
the highway you can increase the number of times where you can take assets,
it is going to become a big motivating force," said Ira Glasser, executive
director of the American Civil Liberties Union.

This may be one of those rare issues that elicits protests across the
political spectrum -- from the ACLU to the National Rifle Association.

Americans don't realize that forfeitures often occur to "ordinary people
who happen to find themselves in a situation in which they are simply
suspected of having been somehow involved in criminal activity, whether
those suspicions ever prove out or not," said Roger Pilon, a vice president
at the Cato Institute, a Libertarian think tank.

"The line between a free society and a police state is usually broached in
small steps."

But many police complain that state laws are too restrictive, sometimes
preventing them from taking the money that fuels drug operations.

Others readily admit they avoid state laws because they need to use seized
money to fight the war on drugs -- their own cities and states may not
provide the funding otherwise.

"A lot of state agencies, like the GBI, prefer to work federal cases
because we know it will go directly into our asset forfeiture bank," said
Mark Jackson, director of legal services for the Georgia Bureau of
Investigation.

Some federal officials contend the cases collected by the newspaper prove
nothing.

"In a country this big, you can find cases all over the lot," said Jerry
McDowell, director of the Justice Department's asset forfeiture and money
laundering division. "I don't think police agencies are in the business of
profiting."

Besides, he said, it's legal for police to send seizures to federal
agencies because most state laws do not specifically prohibit that.

"We certainly don't want to subvert state law, and we don't want states to
subvert our law," McDowell said.

But most states do prohibit simply handing off seizures -- their laws give
jurisdiction over seizures to state courts, The Star has found.

What that means, say legal experts and judges who have examined the
little-known state provisions, is that police cannot simply hand off
seizures to federal agents to avoid state requirements. They need a court
order first.

One federal court in a Louisiana case even derisively likened the evasion
maneuver to a trick football play. The court wrote:

"NFL sportscasters might call the handoff from the Sheriff's Office to the
DEA, followed by the lateral back from the DEA to the Sheriff's Office, a
'flea-flicker.' "

Safeguard erodes

Forfeiture itself is not new -- many colonists fled England in part because
the king's law allowed forfeiture, but it followed them to America.

John Hancock, the first signer of the Declaration of Independence, was
defended by John Adams when the Crown seized his ship for failure to pay a
despised tax on its cargo of Madeira wine.

James Madison, Thomas Jefferson and other founding fathers determined
forfeiture would be used only on a limited basis -- to seize foreign ships
for failure to pay customs duties, for example.

As a result, the Bill of Rights protects Americans from illegal searches
and seizures: No person shall "be deprived of life, liberty, or property,
without due process of law; nor shall private property be taken for public
use, without just compensation."

Two hundred years later, much has changed with the advent of the war on drugs.

In passing a 1984 law, Congress thought that if federal and local law
enforcement agencies cooperated more closely, they could shut down drug
operations by confiscating dealers' money.

Federal agencies would share assets they seized in drug busts with local
police who helped them. That would reimburse police for the cost of helping
to fight the war on drugs.

"The intent was to permit the feds to share with state and local law
enforcement when there were truly federal cases," former U.S. Rep. William
J. Hughes, the chief sponsor of the bill and a New Jersey Democrat, said in
a recent interview.

But it was up to the Justice Department to write the guidelines to
implement the law -- and that's where critics say the intent of the law was
twisted.

In addition to addressing joint investigations led by federal agencies, the
Justice guidelines created a process called "adoption."

Under adoption, state and local police could give their seizures to the
federal government -- even if a federal agency had not been involved.

The Justice Department "turned around and permitted the forfeiture laws to
be used basically to circumvent state law," Hughes said.

As a result, private citizens are now more vulnerable to forfeiture because
circumvented state laws often provide more protections than federal
forfeiture laws.

For example, some state laws protect people from having property forfeited
by police unless they're charged with a felony.

But under federal law, authorities don't even need a criminal charge to
forfeit property.

In fact, experts estimate that the great majority of forfeitures occur
without a criminal charge.

Most state laws require that forfeitures be ordered by a judge. Federal law
enforcement has the power to order forfeitures without a judge -- and does
in most cases.

And it's costly to contest a federal forfeiture. Defense attorneys estimate
it costs at least $10,000, so many won't even accept a case unless the
value of the seizure is large.

Although many people whose property is seized are no doubt guilty of a
crime, that doesn't mean all are.

Charlotte Carroll, a disabled, 64-year-old Maryland woman, could lose her
house because police found a third of an ounce of cocaine and other drugs
that some of her children left there.

Under Maryland law, a house usually can't be forfeited without a criminal
conviction. Police tapped the federal government to forfeit the three-acre
property, which has been in Carroll's family for a century.

"I got sick, so sick in my stomach and started crying," Carroll said. "I'm
just praying."

Carroll, who has osteoarthritis and receives $500 a month from Social
Security disability, has never been convicted of a crime, her attorney said.

"The state can't take her house, so they run to the feds," said the
attorney, Stephen F. Allen.

Carroll continues to live in the home while Allen fights the forfeiture.

David Salem, Assistant U.S. Attorney, described the forfeiture as a "hybrid
adoption" because federal agents were aware of the police investigation but
were not involved in the searches.

Salem also said the forfeiture would be justified because Carroll didn't
take enough steps to protect her property, even though she says she evicted
her children and changed a lock before proceedings began.

"She claims she changed a lock on a door though I'm unclear which door it
is," Salem said. "She claims she took steps that even if I would credit
them as true, the government believes them to be insufficient to justify
innocent ownership. There was no effect. That didn't keep the children out
of the house."

It's no accident that many state laws have tougher forfeiture standards
than federal law, legislators say.

"We have tried to make sure that people who are subject to forfeitures have
some basic rights," said Georgia Rep. Jim Martin, a Democrat and chairman
of the Judiciary Committee.

And some of those protections are erased when police give the money to
federal law enforcement.

Using the feds

Not all police departments send forfeitures to federal agencies, but many
that do candidly acknowledge it.

"Everybody uses the federal system," said Lt. Harry Kearley of the Alabama
Bureau of Investigations.

Sometimes, police explain, they believe money they seize is linked to
drugs, but they can't prove it under state standards, and they don't want
to give the money back to a suspected drug dealer. Federal law lets them
take the money out of the owner's hands.

For example, police in Azusa, Calif., used easier federal requirements to
take at least one forfeiture worth more than $450,000 to them.

In 1998, an officer stopped a driver for improper use of his turn signal
and searched the vehicle when the driver said it didn't belong to him. The
officer found $611,500 in a hidden compartment. A dog signaled the presence
of drug residue on the cash.

To forfeit the money under state law, police usually need a felony conviction.

But police found no drugs and sent the driver on his way.

Soon after, the department gave the money to a federal agent.

"The reality is there are situations under which California law will not
permit forfeiture, and federal law will," said Andy Cuellar, a deputy
district attorney in Alameda County, Calif.

"There is very little California can do about it."

An Alaska case shows just how strong federal powers are.

Fairbanks police had seized $44,850 in cash from Perry Johnson after
finding cocaine in his home. But charges were dismissed because of an
illegal search. Police knew they couldn't keep the money under state law,
so they gave it to the DEA for adoption.

The state Supreme Court ruled in 1993 that police had no right under state
law to give the money to the DEA. Under federal law, though, police could
keep the money, so the city wrote a cashier's check to Johnson for $58,654,
which included interest, according to court records.

But the DEA seized that money, too, saying it could be traced to drug
transactions. The federal government returned 40 percent to 60 percent to
Fairbanks police, a police official said.

High stakes

Forfeitures can mean a lot of money for police.

The Justice Department says that from October 1996 through March 1999 it
accepted $208,454,000 in seizures from state and local police.

But that figure is still being audited because the Justice Department has
not published an annual forfeiture report since 1996, although the law
requires the report to be produced each year.

In fact, the $208 million figure is almost certainly low.

Over one period, the Justice Department reported that Missouri police gave
federal agencies only half as much as the state auditor found in just a
sampling of cases.

Whatever the nationwide total, forfeitures can quickly add up for
individual departments.

In 1997 and 1998, the St. Louis Metropolitan Police Department received
back more than $2.5 million.

In 1998 alone, the Georgia Bureau of Investigation took back $1.7 million.

(Both those figures include proceeds from joint investigations.)

And in a single case in Indiana, a state trooper stopped a truck for
speeding on Interstate 70. Troopers found $811,470 and turned it over to
the DEA, which this year returned almost $500,000 to the state police and
$121,000 to a sheriff's department that helped.

Indeed, enough is at stake that police work with federal agencies no matter
what their state law may be.

For example, police in some states that award forfeiture money to special
funds purposefully divert the money so it can end up in their coffers.

Wisconsin law mandates that forfeiture money goes to public schools, but
only $16,906 went into Wisconsin's education fund during the year ending in
June 1999, according to the state treasury department. During just six
months of the same period, local law enforcement gave the federal
government $1.5 million in seizures.

In Kentucky, no forfeited money has gone into a substance abuse fund for at
least four years, even though some should under state law.

In fact, The Star found that police circumvented[ folo ] their laws even in
states that would have given them back much of their seizures had they gone
through state court.

Maj. Gale T. Griess of the Nebraska State Patrol said the patrol hands off
most seizures to federal agencies so it doesn't have to split the money
with education, as state law requires.

In Kansas, police are allowed most of the money back under state law.
Nonetheless, the Kansas Highway Patrol admits handing off money to federal
agencies.

And surprisingly, even in states such as Alabama that let law enforcement
keep all the forfeiture money after costs, police still can be found giving
their seizures to federal agencies. The reason: Forfeitures are easier
under federal law.

Law enforcement officials say police are justified when they make that choice.

"If they are out enforcing the law and they are seizing property from
criminals, and they are doing it in conjunction with the federal
government, they are not getting around (state) law, they are helping
enforce federal law," said McDowell of the Justice Department.

State roadblocks

But The Star found that more than two-thirds of all states appear to
prohibit handing off money to federal agencies without permission of a
state court.

Those states have requirements that courts have called "turnover orders."
Many of the provisions read like the one in Illinois:

"Property taken or detained under this section ... is deemed to be in the
custody of the law enforcement department or agency employing the seizing
officer subject only to the orders and judgments of the circuit court
having jurisdiction over the forfeiture proceedings."

That means only a state judge can transfer a seizure to a federal agency,
legal experts say.

"This statute is not difficult at all," said David Harris, a University of
Toledo law professor and constitutional expert. "The state court has
jurisdiction."

A half-dozen state and federal court decisions have backed that interpretation.

"A local police department may not take seized property and just pass it on
as it pleases to the FBI in flagrant disregard of state laws," according to
a federal circuit court opinion in an Illinois case.

Gene Zoegtlin, legislative counsel for the International Association of
Chiefs of Police, said he was aware of the turnover provisions but was
unfamiliar with how they worked. He referred questions to the Justice
Department, which did not respond.

But even some prosecutors concede police can't just hand off forfeitures.

Under Alabama law, a court must decide when to transfer seizures to a
federal agency, not police, said Yvonne Saxon, Alabama assistant attorney
general.

"If you read the statute literally, there is no choice," Saxon said.

When questioned, police offer a number of reasons for not following
turnover orders:

They did not know the law existed.

They did not really seize the money -- they were only holding it until a
federal agency could officially seize it for forfeiture.

Money seized on an interstate highway may be involved in interstate drug
trafficking, and therefore is a federal matter.

Police officers sometimes are not really acting as local police -- they've
been deputized to be federal agents, even though they are still paid by
local or state governments. And cash becomes federal property when a
deputized officer picks it up, they say.

For its part, the DEA says a state case becomes federal if police
investigating the case ask a DEA agent to come to the scene of the crime.
"That agent can seize the asset on behalf of the DEA and initiate a federal
forfeiture proceeding," the DEA wrote in response to questions from The Star.

Critics say such reasoning is legally dubious and seems an attempt to
obscure the real issue -- police want the money, and that generally
requires evading their state laws.

Indeed, police say they need the money if they are to continue the war on
drugs. If they lose forfeiture money, they say, local governments are
unlikely to replace it.

For example, Capt. Ruben Davalos, head of the special investigations unit
for Albuquerque, N.M., police, pointed out that his unit costs about $1
million a year, of which the city only funds about $250,000.

Joseph McNamara, former San Jose and Kansas City police chief, said city
officials can take some of the blame for the federal hand-offs.

He recalls one year in San Jose his department's tentative budget had no
money for equipment, so McNamara asked the city manager why.

"He kind of waved his hand dismissively and said, 'Well, you guys seized $4
million last year, I expect you to do better this year,' " McNamara said.

State law doesn't account for the cost of doing drug investigations, so
police are justified in bypassing it, said Missouri Highway Patrol Sgt. Tim
Rousset, who heads a task force in southwest Missouri.

"There was once a state law that said black people and white people would
go to different schools," Rousset said. "Just because there is a state law
doesn't necessarily mean that that state law is correct."

But the end never justifies the means, especially in law enforcement, said
Eric Sterling, president of the Criminal Justice Policy Foundation, a
Washington think tank.

"When a police officer on patrol understands the chief is saying it's OK
for us to keep property that is not ours, the chief is sending a very
bright, neonlike message," Sterling said.

"The rules don't matter."

Besides, others say, police who use forfeits to fund themselves end up on a
treadmill.

"The real narcotic here is the money," said Glasser of the ACLU. "It
becomes a stream of income that they learn not to do without and then they
have to generate more of it."

Part 1b, http://www.mapinc.org/drugnews/v00/n680/a04.html