Erratic Enforcement: A Survey of Asset Forfeiture Practices in Missouri

0:00What I'm going to talk to you about is asset forfeiture. How many people in this room have ever heard of civil asset forfeiture? Okay, well, most people, you don't get that big of a response. Most people have not heard of civil asset forfeiture, so I'm going to briefly explain what it is for any of you who do not know exactly what it is. Basically, it is a legal process that allows the government to take your stuff, and they don't have to have had they now this is different from criminal forfeiture in that they do not have to convict you of a crime in order to take your stuff all they have to do is show that it's more likely than not that your property was involved in a crime and if you don't contest it they don't even have to do that because if they take your stuff and then they have it and And it's just too costly for you to go fight the government, which most of the time it is,

0:56then they can just take it and they don't have to ever go to court to prove anything. So the idea for civilized forfeiture goes back quite a ways. It actually goes back to biblical times. There was a concept known as deodans, basically where they thought that any property involved with a crime was, in essence, haunted. So if a sword was used to kill somebody, people believed that that sword was then infused with that spirit and it couldn't rest until you brought the sword to the king and he would have to either destroy the sword or do something for the good of the community with it and then that spirit could be laid to rest. And so the idea was always that the property was somehow tainted by the crime that it was involved with.

1:43But in the American context, basically it has been a tool of the drug war. So in the 1970s, the Drug Abuse Prevention and Control Act, this is what first allowed law enforcement to start seizing property that was involved in the drug trade. the Federal Reserve, fiat money, fractional reserve banking, Human Action and State, The Theory of Money and Credit

2:32keeps about up to 15% or more of the proceeds and up to 85% of the proceeds of that sale can then be kicked back to the local or state law enforcement agency that made the initial seizure. So I think, you know, I'm in a room with a bunch of economists, I think we can all see the sort of incentives that are at work here. If you're a law enforcement agency and you have to make a budget, you have every incentive Civil Forfeiture of Missouri

3:29go to the law enforcement agencies. So what does the law enforcement agency response to that? Well, we're just not going to forfeit anything to the state law. We'll bring in federal, either the FBI or the DEA or some federal agency and use them to make equitable sharing and so that way they can get the money back as opposed to giving it to the schools. and so there's a series of articles were run on the St. Louis Post-Dispatch uncovering all this back in the early part of the last decade so the early 2000s and it became a pretty big scandal and they decided that they were going to try to do some reforms so at the state level some of those reforms first 1993 they forbade any forfeiture unless the person was convicted of a felony charge and then in 1999 In 2000, a bunch of more articles in the Kansas City Star showed that forfeiture funds were not going to schools but back to the police. So then in 2001, there was a reform law that

4:37said that if the state wanted to seize anything from you, it had to, they defined seizure in such a way that essentially you couldn't take anything for any length of time until The Federal Reserve, fiat money, fractional reserve banking, Human Action, Man Economy and State, The Theory of Money and Credit

5:21Back in 2001, and that culminated with the passage of CAFRA, the Civil Asset Forbiture Reform Act, and this allowed for an innocent owner defense, so if you could show that, you know, while the property may have been used in a crime, you had no knowledge of that, so hypothetically, if someone stole your car and then used it to sell drugs, if the police If you ever found that car, they could still take the property. Well, with an innocent owner defense, they would then have to give the car back to you. So that's some kind of defense against asset forfeiture, but it's still not a ton. And also, it provided counsel for any low-income defendants who, if their house was being forfeited, and also if it's your house that is being forfeited, you can still live in it up until the point that they actually prove the forfeiture.

6:18Anything but your house, they can just take and keep it until you win the case or, you know, if you don't win, you'll never get it back. Nonetheless, though, federal forfeiture has skyrocketed since then, so it was $338 million in 1996 and we were up to $1.3 billion by 2008. That is in constant, I believe that's in constant 2008 dollars, by the way, so... Alright, so, what Caffer did not change. Basically, police still have the incentive to forfeit through federal law because equitable sharing still exists. The state's burden of proof at the federal level is still the relatively low preponderance of the evidence. So as opposed to a criminal law, criminal lawsuit where you would have, you'd have to prove beyond and a reasonable doubt. In this case, it's just a preponderance of the evidence, so it's a much lower standard for the state to prove. They can also use what are called forfeiture waivers, where they say, okay, so we believe that you may have committed a crime, but we

7:23don't have the actual evidence to prove that. However, we can charge you, and you'll have to go through court and all that, and so what we're going to do is we're going to give you This property isn't mine, I don't know where it came from, and I'm giving it up right now, and that way we will not charge you with a crime. This is basically extortion for all intents and purposes. In Missouri, I'm going to now go through a lot of the data that we've collected. The use of federal forfeiture has increased, but not state forfeiture, which is not surprising given the incentives that are at play here, so they passed these state level reforms, the use of federal forfeiture dropped by nearly half, at least initially, and then state forfeiture proceeds, sort of remained flat, and then the use of forfeiture bounced back really heavily, And particularly, right around the time of the recession in 2007, 2008, we think that's no coincidence, we haven't shown anything causally there yet, but we think it stands to reason that a bunch of police departments were hurting for cash and then started, went out and started looking for money wherever they could find it, asset forfeiture was a way that they could do that. And so, yeah, Missouri is increasingly relying on these

8:59Federal Forfeiture Funds. You can see Missouri compared to all the other surrounding states. So Missouri is the, let's see, a light blue line there. And so the use of it has gone

9:15up immensely. Only Iowa down there, the sort of purple one, has had that increase at the same amount, but certainly not at the same, you know, we're still at a much higher level. So, and here's forfeitures per capita for all these states. Missouri and Nebraska are the two worst out of all of them. And so about $3 per resident is lost in federal forfeitures every year in Missouri. So that's not a ton of money, but that's a lot of money per, you know, when we multiply it out, that's about $18 million a year in Missouri. So it's fairly substantial. and the police departments are pretty creative in the ways they can work around the state forfeiture law. So one thing that the St. Louis City was doing a few years back was that they were towing all these cars that were for minor infractions and then they were giving the cars to a towing agency that would then hold them and basically the towing agency

10:21and the City Police Department were splitting the money and the Towing Agency was also allowing the police officers and relatives of police officers to then use those cars as personal vehicles until people could pay to get them back. This was eventually exposed by a series of articles in the Post-Dispatch and you can see the reports that we have showing In 2007, there were 934 seized, 593 in 2008, and then the towing scandal was exposed in July 2008, and immediately the number falls to one. So it's pretty clear what was going on here.

11:06and also I should emphasize that even the 593 number, that was more than the rest of the state was towing, more than the rest of the state was seizing in terms of vehicles combined, so it was just an obvious flaw that no one was even paying attention to, but it was right there in front of anyone's faces if they had actually cared to look at the reports. Also, so a lot of these people that have stuff forfeited from them are never convicted or in some cases never even charged with a crime. So in 2007, there were 612 forfeitures, 253 of those people, there were either no criminal charges filed or they were found innocent.

11:54595, 2008 versus 278, innocent or no charges, 554 to 262. So, we're always looking at about, you know, somewhere around over a third of these people are never charged or found innocent of the crimes that the property is supposedly connected with. So, that's a pretty big problem. Okay, and we also have a vast, vast difference in the way that the counties are interpreting these laws. Some counties are actually interpreting them in a pretty good way. So the state statute reads that the property of persons arrested, detained, sorry it says detailed, but detained or apprehended and not subsequently charged is not subject to forfeiture for that arrest, Attention or Apprehension.

12:46And so, Boehm County, where the University of Missouri, where Per is, that's probably one of the best ones. The average delay between filing for forfeiture and filing of criminal charge there is 4.2 days. However, the longest delay, 535 days, so, you know, looking at a year and a half. But then compare that to Franklin County, which is just south of St. Louis County, and Your average delay between seizures and filing a criminal charge or dismissal is 342 days. That's the average. So, you know, they seize your stuff and then they wait around, don't file criminal charges, and take almost a year to give you your stuff back after finally deciding not to charge you. And the longest delay was 711 days. There was a criminal charge ultimately filed there, but it took them almost two years to get around to filing the criminal

14:10The federal law has all the perverse incentives in it, so local law enforcement agencies can just go that route and take people's property. And so one of the things that we should look at doing is removing that financial incentive. Now, there's nothing that prevents a locality from telling their police department, look, for every dollar that you seize and get from the federal forfeiture fund, we're going to offset your budget by taking a dollar away from you. and that can actually be an attractive solution to a lot of localities because they're trying to save money as well so they can just say, well, you know, we're not going to give you any money if you keep relying on asset forfeiture for your dollars and that has been shown in the literature to reduce the amount of forfeitures that happen. And then also if a defendant's property is held for an unreasonable amount of time, I think anything over a couple of months is, you know, ," obviously pretty unreasonable. That person should be compensated for the loss of their property.

15:13And then, forfeitures should not be a substitute for criminal law, and by that I mean they shouldn't have these waivers where they can just say, oh well, we don't want to charge you with a crime, we would just rather take your stuff. If they have the evidence to charge you with a crime, they should have to go ahead and charge you and fight that battle in a in a court where the burden of proof is reasonable doubt, not preponderance of the evidence. And finally, Boone and Buchanan County serve as models for the rest of the state of Missouri because they actually seem to take the law at its letter and at its spirit and try to enforce things the way they should be.

15:59So that is pretty much it. And I can, if anyone is interested afterwards, I can email you a copy of this paper. We're still sort of going through the editing process, but we're looking for comments from people who, you know, are familiar with economics and know the literature and that sort of thing. So we would love to hear back from you. All right. Thank you very much.