Tenth Amendment Center: South Carolina Bill Would Take First Step Toward Closing Federal Asset Forfeiture Loophole

From Tenth Amendment Center

...from Tenth Amendment Center

COLUMBIA, S.C. (Dec. 21, 2017) – A bill prefiled in the South Carolina House would reform the state’s asset forfeiture laws to minimize the policing for profit motive and would partially close a loophole that allows state and local police to circumvent more strict state forfeiture laws by passing cases off to the feds.

Rep. Cezar McKnight (D-Williamsburg) prefiled House Bill 4518 (H.4518) for the 2018 legislative session. The bill would require proceeds from asset forfeitures to go into the general fund for disbursement to certain school districts. It would also prohibit the transfer of seized assets from state law enforcement agencies to federal agencies without a court order.

According to the Institute for Justice, law enforcement agencies in South Carolina get to keep up to 95 percent of forfeiture proceeds, with 75 percent going to police agencies and 20 percent to prosecutors. This creates a powerful incentive for police to pursue forfeiture in what has come to be known as “policing for profit.” Passage of H.4518 would eliminate this incentive.

Passing this legislation would also take the first step toward closing a loophole that allows state and local police to get around more strict state asset forfeiture laws in a vast majority of situations. This is particularly important in light of a new policy directive issued last July by Attorney General Jeff Sessions for the Department of Justice (DOJ).

FEDERAL LOOPHOLE

A federal program known as “Equitable Sharing” allows prosecutors to bypass more stringent state asset forfeiture laws by passing cases off to the federal government through a process known as adoption.The new DOJ directive reiterates full support for the equitable sharing program, directs federal law enforcement agencies to aggressively utilize it, and sets the stage to expand it in the future.

Law enforcement agencies often bypass more strict state forfeiture laws by claiming cases are federal in nature. Under these arrangements, state officials simply hand cases over to a federal agency, participate in the case, and then receive up to 80 percent of the proceeds. However, when states merely withdraw from participation, the federal directive loses its impact.

Until recently, California faced this situation.The state has some of the strongest state-level restrictions on civil asset forfeiture in the country, but state and local police were circumventing the state process by passing cases to the feds. According to a report by the Institute for Justice, Policing for Profit, California ranked as the worst offender of all states in the country between 2000 and 2013. In other words, California law enforcement was passing off a lot of cases to the feds and collecting the loot. The state closed the loophole in 2016.

H.4518 would take the first step toward closing this loophole in South Carolina by prohibiting state and local police from passing cases to the feds without a judge’s order.

No property seized by a law enforcement agency or department may be transferred to a federal law enforcement agency or department without an order authorizing the transfer by a court with jurisdiction over the property.

But this would not stop local police from cashing in on equitable sharing through assets seized by joint task forces. According to the Institute of Justice, 62 percent of proceeds received through equitable sharing came from joint task forces and investigations. Asset forfeiture cases initiated by joint task forces could still be prosecuted under through the federal process without state judicial oversight and police departments could still receive equitable sharing funds.

Even so, passage of H.4518 would address more than a third of equitable sharing cases, and would set the stage for further action in the future.

As the Tenth Amendment Center previously reported the federal government inserted itself into the asset forfeiture debate in California. The feds clearly want the policy to continue.

Why?

We can only guess. But perhaps the feds recognize paying state and local police agencies directly in cash for handling their enforcement would reveal their weakness. After all, the federal government would find it nearly impossible to prosecute its unconstitutional “War on Drugs” without state and local assistance. Asset forfeiture “equitable sharing” provides a pipeline the feds use to incentivize state and local police to serve as de facto arms of the federal government by funneling billions of dollars into their budgets.

WHAT’S NEXT

H.4518 will be officially introduced when the 2018 regular session opens in January. It will be referred to the House Judiciary Committee where it will need to pass by a majority vote before moving on to the full House.

Mike Maharrey
December 21, 2017 at 06:54AM