equitable sharing in asset forfeiture cases

Equitable Sharing in Forfeiture Cases is not Dead

The reports of my death have been greatly exaggerated.” – Mark Twain

In December of 2015 the Department of Justice announced that it was halting its equitable sharing program, a move that sent shock waves throughout many law enforcement agencies.

The action, and even more so, the reaction, shows just how big the forfeiture apparatus continues to be. According to the DOJ, more than $1.3 billion is estimated to have been forfeited in 2015 (a downtick from over $3 billion in 2014). Further, that same report estimates that $314+ million was distributed to local law enforcement agencies in 2015 (a downtick from $450 million in 2014).

Forbes: Cops In Texas Seize Millions By ‘Policing for Profit’

Locally, Forbes reported that the Tarrant County District Attorneys Office, in coordination with the Drug Enforcement Administration (DEA), received almost $2.9 million from the DOJ via equitable sharing.

This data indicates how large the forfeiture apparatus has become and, more importantly, that it is going to stay.

What is Asset Forfeiture?

Asset forfeiture is a legal authorization of the deprivation of private property on the basis that it is linked to a criminal offense. The two most common forfeiture theories are proceeds and facilitation.

What is Equitable Sharing?

What is equitable sharing? The DOJ’s ‘Equitable Sharing Program’ authorizes the distribution of 80% of federally forfeited proceeds to local law enforcement agencies who assist investigative efforts related to a federal forfeiture case. For example, if a local police officer helps execute a search warrant that leads to recovery of multiple pieces of jewelry that are ultimately proven to be bought with proceeds of an investment scheme, and if these items become the subject of either a civil or criminal case in the federal system, then, if the forfeiture prosecution is successful, then that officer’s department may get a cut of the sale of those items.

What is Federal Adoption?

What is federal adoption? In the past, seizures that began at the state or local could ultimately be litigated through federal forfeiture. For example, if the officer above executed a state search warrant, the jewelry may still have been pursued federally. This process was known as adoption and became criticized for its adoption of local matters. Over the last few years many concerns have arisen regarding federal adoption procedures and equitable sharing. Notably, assets can be seized and forfeited from individuals who have not been charged with or convicted of a crime. This debate raises a serious question:

Why would local agencies use the feds to complete their forfeitures?

Simple. Equitable Sharing splits were more attractive then what police agencies could keep in dealing with local prosecutors. Last January, federal adoption was limited.

However, there is still coordination between federal and state agencies and with such coordination comes equitable sharing. For example, many federal drug cases involve the use of local police officers to perform surveillance tasks, conduct necessary traffic stops, and assist with searches and seizures. As long as the case is prosecuted federally, there is still going to be equitable sharing.

Because the amounts of money and property local, state, and federal agencies stand to gain via seizure, forfeiture, and equitable sharing, these efforts provide a massive financial incentive to pursue asset forfeiture cases. With what’s at stake, it is easy to see why agencies got upset at the DOJ’s announcement in December. However, the sky isn’t falling for police agencies wishing to get attractive equitable sharing payouts. Just like Government sequestration scares that occur once every 1-2 years, this halt is a stall, not a blowout. The DOJ has made clear that the equitable sharing program is still “up and running.”

“While equitable sharing payments are on hold until the funding situation improves, we continue to review and process requests for sharing with the goal that if the budget situation improves, we will be able to resume payments with only minimal processing time.”

In other words, the program is ‘halted’ but not ‘ended.’

It is important to recognize that many IRS, DEA, FBI, ATF, Customs, ICE, and other federal criminal investigations are conducted with local police agencies, District Attorney’s Offices, and state Attorney General’s Offices. For example, many DEA drug conspiracy prosecutions under 21 USC 841 and 846 are performed in conjunction with city police departments and task force officers (TFOs that are deputized by the federal agency but still commissioned with a local police department). Another example, the IRS, Secret Service, or FBI may pursue mail and wire fraud investigations regarding false IRS tax refunds. These cases are also handled in coordination with local police. Or, the FBI may assist in the investigation of a home health agency for potential violations of 18 USC 1035. It is important to understand that all of these offenses provide for forfeiture under 18 USC 981, 982, and 983 and are all subject to equitable sharing arrangements in the event of a successful forfeiture prosecution.

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