Colorado legislators are considering a proposal that would require law enforcement agencies to accurately track how and why they seized property from suspected criminals and how they used the proceeds. Civil asset forfeiture, also known as civil judicial forfeiture, is a controversial legal process through which law enforcement agencies take personal assets from individuals or groups merely suspected of a crime or illegal activity. Three states have essentially abolished the practice of asset forfeiture – Nebraska, New Mexico, and North Carolina – and more than a dozen other states have made significant forfeiture reforms.
Compared to other states, Colorado’s civil asset forfeiture laws are in the middle of the pack. The state earned a “C” grade in a 2016 study of civil asset forfeiture by the Institute for Justice (IJ). The state standard for seizure requires clear and convincing evidence, and the amount law enforcement agencies can keep of seized fund is capped at 50 percent of all funds generated through civil forfeiture, a weak cap but a cap nonetheless. However, Colorado’s civil asset forfeiture laws are in need of improvement.
Colorado law requires reporting on forfeitures, but these requirements are limited, infrequently followed, and not made easily accessible for public or legislative review. When IJ made requests for forfeiture reports, it found files were missing or had not been reviewed, making it difficult to extrapolate any trends from them. What IJ did find was Colorado seized almost $13 million between 2000 and 2013 through state seizures.
Proponents of forfeiture argue it allows law enforcement agencies to use seized assets toward their enforcement efforts, transforming property illicitly gained by criminals into resources to be used for public benefit. Critics of the process note it gives law enforcement agencies economic incentives to seize property, corrupting them and penalizing innocent property owners.
The main issue with the Colorado’s forfeiture policies is its use of equitable sharing arrangements, whereby local law enforcement and federal officials agree to classify the suspected criminal activity as a federal crime and divide the seized assets between them. The federal agencies receive between 10 and 20 percent, and the local police get the remainder. This allows local law enforcement agencies to ignore state law, which only allows 50 percent, while circumventing the will of state legislatures and the people.
In a Denver Post op-ed, Jennifer McDonald, a research analyst at the Institute for Justice, said Colorado law enforcement agencies have frequently exploited the equitable sharing loophole. McDonald found that between 2000 and 2013, law enforcement used equitable sharing to take in over $47 million from the Department of Justice; this is far more than the amount collected under state forfeiture laws.
“Tightening the loophole would improve protections for innocent Coloradans without compromising the ability of law enforcement to target true threats to public safety, such as large drug-trafficking operations. States like New Mexico, Nebraska and, most recently, Ohio have already enacted similar safeguards against abuses of equitable sharing,” wrote McDonald.
One of the bill’s primary goals is to increase the information available on forfeiture by requiring police and prosecutors statewide to report the property they seize, including information on how it was forfeited, whether the suspect was convicted of a crime, and how they used the proceeds.
According to the Tenth Amendment Center, the Colorado bill now under consideration also prohibits state agencies from transferring seized property to a federal agency unless it has a net value of more than $50,000 and disallows Colorado agencies from accepting funds from a federal agency resulting from an equitable sharing arrangement unless “aggregate net equity value of the property and currency seized in the case is in excess of $50,000, the case is commenced by the federal government, and it relates to a filed criminal case.” This limits small forfeitures while preserving the seizure of funds from criminals involved in larger cases.
The Colorado proposal would take significant steps toward closing this loophole while increasing transparency within the state’s civil asset forfeiture program and limiting equitable sharing.
The following documents provide additional information about civil asset forfeiture.
Colorado Bill Would Close Federal Asset Forfeiture Loophole in Most Situations
http://blog.tenthamendmentcenter.com/2017/04/colorado-bill-would-close-federal-asset-forfeiture-loophole-in-most-situations-2/
The Tenth Amendment Center examines the new civil asset forfeiture proposal in Colorado and argues it may represent a significant step toward closing the loopholes used by Colorado law enforcement agencies.
Playing Both ‘Cops and Robbers’ on Asset Forfeiture
https://heartland.org/news-opinion/news/playing-both-cops-and-robbers-on-asset-forfeiture?source=policybot
Jesse Hathaway, managing editor of Budget & Tax News, examines in this article a new digital system that allows highway patrolmen to use civil asset forfeiture laws to seize individuals’ assets stored in bank accounts or on prepaid debit cards at the press of a button. “Civil asset forfeiture creates too many perverse economic incentives. However well-intentioned the idea may be, the practice of civil asset forfeiture has been corrupted and now infringes on Americans’ right to be free from harassment by money-hungry agents of the government,” wrote Hathaway.
Policing for Profit: The Abuse of Civil Asset Forfeiture 2nd Edition
http://ij.org/wp-content/uploads/2015/11/policing-for-profit-2nd-edition.pdf
Dick Carpenter, Lisa Knepper, Angela Erickson and Jennifer McDonald argue civil asset forfeiture laws constitute one of the most serious assaults on private property rights in the nation today. “Civil forfeiture threatens the constitutional rights of all Americans. Using civil forfeiture, the government can take your home, business, cash, car or other property on the mere suspicion that it is somehow connected to criminal activity—and without ever convicting or even charging you with a crime. Most people unfamiliar with this process would find it hard to believe that such a power exists in a country that is supposed to recognize and hold dear rights to private property and due process of law,” they write.
Civil Asset Forfeiture, Equitable Sharing, and Policing for Profit in the United States
https://heartland.org/publications-resources/publications/civil-asset-forfeiture-equitable-sharing-and-policing-for-profit-in-the-united-states?source=policybot
Jefferson E. Holcomb and Marian R. Williams, professors in the department of Government and Justice Studies at Appalachian State University, and Tomislav V. Kovandzic, a professor in the University of Texas–Dallas School of Economic, Political, and Policy Studies, identify the effects of civil asset forfeiture reform on law enforcement activities. They write, “There is substantial anecdotal evidence that law enforcement [agencies] utilize a variety of tactics to generate the greatest revenue from their forfeiture operations,” a hypothesis their analysis of U.S. Department of Justice statistics confirms.
Seize First, Question Later: The IRS and Civil Forfeiture
https://heartland.org/publications-resources/publications/seize-first-question-later-the-irs-and-civil-forfeiture?source=policybot
Institute for Justice researcher Dick M. Carpenter II and attorney Larry Salzman examine the use and abuse of civil asset forfeiture laws by the Internal Revenue Service. “Federal civil forfeiture laws give the Internal Revenue Service the power to clean out bank accounts without charging their owners with any crime,” they write.
Civil Asset Forfeiture: 7 Things You Should Know
http://www.heritage.org/research/reports/2014/03/civil-asset-forfeiture-7-things-you-should-know
This Heritage Foundation Factsheet outlines several important things people should know about civil asset forfeiture.
Civil Asset Forfeiture Reform Goes Mainstream https://heartland.org/publications-resources/publications/civil-asset-forfeiture-reform-goes-mainstream?source=policybot
Jordan Richardson of The Heritage Foundation discusses how the growing number of civil asset forfeiture abuses has drawn the attention of news media and suggests the increased attention may lead to real reform.
The Civil Asset Forfeiture Racket http://reason.com/archives/2014/09/24/the-civil-asset-forfeiture-racket
A. Barton Hinkle of the Reason Foundation examines the growing problems created by civil asset forfeiture and argues for repeal of such laws.
Nothing in this Research & Commentary is intended to influence the passage of legislation, and it does not necessarily represent the views of The Heartland Institute. For further information on this and other topics, visit the Budget & Tax News website, The Heartland Institute’s website, and PolicyBot, Heartland’s free online research database.
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Matthew Glans joined the staff of The Heartland Institute in November 2007 as legislative specialist for insurance and finance.
