New Bill In Congress Would Ban “Nonjudicial” Civil Forfeiture

To protect innocent Americans from “lawless” police seizures, Reps. Jamie Raskin (D-MD) and Tim Walberg (R-MI) reintroduced a bill on March 9 that would significantly overhaul the federal government’s civil forfeiture laws. Civil forfeiture lets the government seize and keep valuable property without ever convicting the owner of a crime or even filing criminal charges. And under federal law, innocent owners who want to reclaim their seized property must prove they weren’t involved in any wrongdoing, flipping the presumption of innocence straight on its head.

In a bitterly divided political landscape, the Fifth Amendment Integrity Restoration Act (H.R. 1525) is a refreshing display of bipartisanship, receiving an equal number of Democratic and Republican co-sponsors.

“Seizing property and handing it over to the government without proof of wrongdoing is fundamentally un-American,” said Rep. Tony Cárdenas (D-CA), one of the original co-sponsors for the FAIR Act. “In the United States, we are innocent until proven guilty, and the government may not seize our property without just cause. It’s past time to reform our civil asset forfeiture system and make it fairer for the American people.”

First, H.R. 1525 would eliminate the most abusive type of civil forfeiture: administrative or “nonjudicial” forfeiture, which somehow manages to have even fewer protections. Instead of an independent, neutral judge hearing the case, under administrative forfeiture, the seizing agencies themselves decide whether to forfeit the property. That is a blatant conflict of interest, especially since federal law lets agencies keep up to 100% percent of the proceeds from forfeited property.

If an owner fails to file a claim quickly enough, that triggers a “default judgment,” with the seized property automatically forfeited to the federal government. Aside from real estate and assets valued at more than $500,000, almost any property can be taken through nonjudicial forfeiture.

Given such a stacked deck, it’s no surprise that federal agencies overwhelmingly prefer administrative forfeiture. According to a report by the Institute for Justice, 78% of all forfeiture cases processed by the U.S. Department of Justice were administrative. In other words, barely a fifth of the Justice Department’s forfeiture cases actually involved some level of judicial oversight.

Rates are even more abysmal for other federal departments. At the Treasury Department and the Department of Homeland Security, administrative forfeiture accounted for 96% and 98.6% of their entire forfeiture caseloads respectively. By only allowing forfeiture to occur “through judicial process,” the FAIR Act would effectively end the legal shortcut used to process almost all civil forfeiture cases on the federal level.

“Innocent until proven guilty has little meaning if law enforcement can seize your assets before you ever appear in a court on a criminal charge,” noted Rep. Kelly Armstrong (R-ND), who also co-sponsored the FAIR Act.

In addition to requiring actual judges to hear forfeiture cases, the bill would add multiple new safeguards to further protect due process. The FAIR Act would squarely place the burden of proof onto the federal government—where it belongs—and also require “clear and convincing evidence” that a seized property was linked to criminal activity. Currently, federal agencies can permanently confiscate property based on a “preponderance of the evidence,” i.e., more likely than not, a much lower standard of proof.

Since many property owners do not have the means to fight an expensive legal battle to reclaim what was taken, the FAIR Act would also guarantee legal representation to those who cannot afford it.

Critically, H.R. 1525 would eliminate the financial incentives that drive so many forfeiture cases. If enacted, any and all forfeiture proceeds would be directed away from the coffers of federal agencies and instead deposited in the general fund of the Treasury. Since 2000, the Department of Justice and the Treasury Department have forfeited well over $50 billion.

Moreover, the FAIR Act would curtail many abusive seizures conducted on the state and local level by ending a federal program known as “equitable sharing.” Under equitable sharing, state and local law enforcement agencies can partner with the federal government, forfeit property under federal law and then keep up to 80% of the proceeds.

In other words, equitable sharing rewards police and prosecutors who bypass stricter limits on civil forfeiture set by state laws. And the program can be incredibly lucrative. Over the past two decades, the federal government has paid out more than $8.8 billion in equitable sharing funding to state and local agencies.

Marine veteran Stephen Lara encountered this first-hand. While driving to California to see his two kids in February 2021, Stephen was pulled over by the then Nevada Highway Patrol. Even though carrying cash and distrusting banks are not crimes, troopers seized his entire life savings—nearly $87,000. It took Stephen over 20 years to scrimp and save that money, including during tours of duty he served in Afghanistan and Iraq.

Stephen was never charged with a crime. Officers didn’t even write him a traffic ticket.

After taking Stephen’s money, Nevada state troopers kicked his case over to the DEA to proceed through equitable sharing. Since Nevada requires clear and convincing evidence to forfeit property in civil court, it would be easier for the agencies to win under federal law.

Fortunately, after the Institute for Justice filed a lawsuit on Stephen’s behalf and sparked a national firestorm, the DEA agreed to return Stephen’s money in October 2021. His lawsuit against the Nevada State Police is still ongoing.

Although equitable sharing was initially pitched as a way to fight crime, after analyzing clearance rates across thousands of different agencies, a study by the Institute for Justice concluded that “more equitable sharing funds do not translate into more crimes solved.” But there was evidence that “during periods of fiscal stress,” police were using forfeiture to “raise revenue.”

“Protecting Americans’ property rights isn’t a partisan issue and we’re glad to see lawmakers from across the aisle working together to pass true reforms,” said Institute for Justice Senior Attorney Dan Alban, who heads IJ’s National Initiative to End Forfeiture Abuse.