Policy Analysis No. 179

American Forfeiture Law: Property Owners Meet the Prosecutor

By Terrance G. Reed
September 29, 1992

Executive Summary

Forfeiture laws have become increasingly popular with state and federal law enforcement officials during the last 10 years. A subject once relegated to obscure passages in the musty recesses of lawbooks, and rarely invoked in practice, forfeiture has quickly become the darling of law enforcement. Since 1985, for example, the total value of federal asset seizures has increased over 1,500 percent—to over $2.4 billion,[1] including over $643 million for the Department of Justice in FY 1991 alone.[2] This bonanza for law enforcement officials, however, has become a Kafkaesque nightmare for some property owners, who have found themselves caught up in a world of bizarre legal doctrine, sometimes without the assets even to defend themselves.

A New Jersey couple, for example, found their home and their two cars seized by local police based upon an allegation that they had violated New Jersey law by stealing Express Mail packages containing inexpensive clothing from the neighbors’ property.[3] Similarly, a substantial New Jersey construction company was seized—lock, stock, and bulldozer— by state officials based upon a contractual dispute in which state officials alleged that the company had won, and performed, three municipal construction contracts upon which it was allegedly ineligible to bid.[4] According to the reasoning of the New Jersey attorney general’s office in that case, if corporate property is used unlawfully, then all corporate property is subject to summary seizure by the government and subsequent forfeiture to the government.[5] In Florida, a sheriff’s department adopted a forfeiture program that authorizes officials who stop and question people on the streets or highways because they look like suspected drug couriers to seize as suspected drug money any cash in amounts over $100 that such people may be carrying, regardless of whether drugs are found.

Nor has the federal government shrunk from engaging in sweeping forfeiture prosecutions. The most popular rationale—confiscating property that “facilitates” criminal conduct—has been used successfully to seize entire bank accounts based upon the deposit therein of any alleged proceeds of criminal activity. Similarly, federal undercover agents and informants are schooled in the financial importance of arranging a drug sale on or near valuable real estate so that the entire tract may be seized under a claim that the real estate “facilitated” the alleged unlawful activity. As informants are often rewarded with a percentage of the value of the assets they deliver in this way, they become very creative and successful in their trade.

Broad forfeiture claims by state and federal officials might be better justified, and enjoy wider public support, if their sting were visited only upon the guilty, those who have intentionally committed crimes. But the oldest and most frequently used form of forfeiture—civil forfeiture—is not targeted at criminally culpable property owners. Instead, as discussed below, civil forfeiture laws apply indiscriminately to property, regardless of the innocence of the owner, and render it subject to forfeiture if it is used unlawfully by anyone. Thus, the family home is fair game for forfeiture if a son, relative, or friend were to use it unlawfully—say, by using the telephone to arrange a drug purchase. Moreover, a growing number of states, such as Texas, Florida, and New Jersey, apply their forfeiture laws to any criminal activity, meaning that property owners must police their property against all such activity, drug- related or not. With the broadened scope and use of forfeiture laws, property owners are increasingly being deputized to serve as agents of the state in preventing wide varieties of criminal conduct. And the price for failure is steep indeed—forfeiture of one’s property to the government.

Moreover, by any measure, forfeiture laws provide the government with unique litigation advantages, benefits not enjoyed by other litigants in any other area of law. They generally permit the government to seize property first, for example, and then place the burden upon the owners to come forward to prove they are entitled to have their property returned. This power of immediate possession, usually through summary government action, provides the government with tangible bargaining advantages at the outset of any title dispute between the government and a property owner. If, as the adage goes, possession is nine-tenths of the law, the government can secure this advantage before it has any obligation to prove anything.

Under federal law the government can seize property based solely upon probable cause to believe that the property was used unlawfully. This probable cause standard for seizure allows the government to dispossess property owners based only upon hearsay or innuendo—“evidence” of insufficient reliability to be admissible in a court of law. The probable cause standard relieves the government of the burden of proving anyone’s criminal guilt to obtain a forfeiture judgment over his property.

Perhaps the greatest advantage the forfeiture laws provide for law enforcement officials lies, paradoxically, in the fact that their legal justification simply defies logic. When asked to justify the extraordinary powers granted to them by such laws, law enforcement officials find themselves invoking peculiar legal fictions that date back to feudal times or earlier, wherein inanimate objects are given life and then forfeited to the government for “their” criminal misconduct. Forfeiture’s justification hinges entirely upon “old, forgotten, far-off things and battles long ago.”[6] As a result, appeals to reason may be unavailing as quirks of legal history are often successful modernday talismans capable of ending rational debate.

As forfeitures become increasingly popular with law enforcement officials, efforts have begun to expand government forfeiture powers beyond those justified solely by reference to historical fictions. In Arizona, for example, the attorney general’s office has unabashedly proclaimed that the mission of Arizona’s forfeiture laws is “ ‘social engineering’ accomplished through government intercession in commercial activity harmful to the economy as a whole.”[7] When such a broad official charter for forfeiture is combined with the unique litigation advantages that forfeiture law already offers to law enforcement, a powerful engine of government power is unleashed.

In this study, I briefly discuss the history of forfeiture and how it has enhanced the power of government over people and their property in ways that are difficult to reconcile with long-cherished constitutional rights. Given the growing use and expansion of forfeiture laws, I argue that the time is ripe for a reevaluation of those laws to make them more consistent with both the Bill of Rights and sound public policy. To that end, I identify some core principles that should guide forfeiture reform and also identify specific reforms of existing law and practice that are consistent with those principles.

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Terrance G. Reed is a partner in the Washington, D.C., law firm Asbill, Junkin and Myers. He is also the ABA advisor to a drafting committee of the National Conference of Commissioners on Uniform State Laws regarding civil forfeitures. All opinions expressed herein are solely those of the author.