Forfeiture

Although Congress expanded its postcolonial use of forfeiture to reach other forms of property, such as misbranded food or illegal distillery equipment, modern forfeiture law dates specifically to 1970. In that year Congress passed two seminal statutes. The first, the Comprehensive Drug Abuse Prevention and Control Act of 1970 (21 U.S.C. § 881) marked the dawn of contemporary drug forfeiture practice. It authorized the government to seize and forfeit contraband drugs, drug manufacturing and storage equipment, and any conveyances used to transport drugs. With subsequent amendments, this law has been applied to embrace an ever-widening list of properties, including assets having a remote connection to illegal drug activity. The law now permits forfeiture of property intended to be used in a drug transaction and property used or intended to be used to facilitate a drug crime. The government has confiscated, for example, entire residences based on a small-scale drug sale on the premises and cars merely driven to meetings where drugs deals were discussed.

The second statutory foundation of modern forfeiture law was the Racketeer Influenced and Corrupt Organizations Act (RICO) (18 U.S.C. §§ 1961–1968). This law, together with criminal forfeiture provisions of the Comprehensive Drug Abuse Prevention and Control Act, rekindled the long dormant idea of using forfeiture of assets as a significant form of criminal punishment. Under RICO, a person convicted of a racketeering offense faces not only prison and a fine but also the loss of any interest in his criminal enterprise and any property, including legitimate businesses, connected to or derived from the racketeering activity. The potential scope of RICO is astounding. For example, in Alexander v. United States, 509 U.S. 544 (1993), the owner of various businesses dealing in sexually explicit materials was convicted of federal obscenity law violations and racketeering. The racketeering offenses were based on a finding that seven items sold in thirteen Minnesota adult stores were obscene and represented a long-running pattern of illegal activity. In addition to a prison term and a hefty fine, the district court ordered forfeiture of all of the defendant's inventory, stores, vehicles, and $9 million acquired in the illegal enterprise.

Although the most popular and well-known use of forfeiture involves seizure of assets connected to drug violations, property is subject to forfeiture under a broad array of federal and state laws. There are over 150 federal laws permitting some form of forfeiture, and almost every state has one or more statutes authorizing confiscation of property. Federal laws permit, for example, forfeiture of property connected to violations of gun laws, gambling laws, liquor laws, customs laws, securities laws, income tax laws, obscenity laws, telemarketing laws, and even wildlife protection laws. A particularly potent statute is the Money Laundering Control Act of 1986, as amended (18 U.S.C. §§ 981, 982), which provides for criminal and civil forfeiture of property involved in or traceable to money laundering and banking related offenses.

The government justifies modern forfeiture law as a highly successful device for taking the profit out of crime and destroying criminal enterprises that tend to continue operating even if some involved individuals are jailed. But forfeitures have become very profitable for the government, and a significant portion of law enforcement revenue now depends on aggressive pursuit of forfeitable property. The central, although not exclusive, clearinghouse for federal forfeiture proceeds is the Asset Forfeiture Program of the Department of Justice. Officials reported that, in 1995, net deposits to the Asset Forfeiture Fund totaled $487.5 million dollars, and that, between 1985 and 1995, the fund received more than $4.3 billion in forfeited property. Since 1989, fund receipts have averaged one-half billion dollars per year and reached $600 million in 1999. A marked jump in forfeiture receipts coincided with the passage of legislation in 1984 that created the fund and permitted drug forfeiture proceeds to be funneled back to the police agencies that seized them.

Monies from the Asset Forfeiture Fund are used for a variety of purposes but the lion's share, about one half, is paid to state and local law enforcement agencies based upon their participation in forfeiture actions. In a practice known as equitable sharing, local agencies ask the federal government to adopt their forfeiture cases. The federal government assumes control, subtracts its expenses, and then returns the bulk of the amount to the local agency to be used solely for law enforcement needs. This payback arrangement allows local law enforcement to evade state legislative or constitutional requirements that may mandate that forfeited property be turned over to the state treasury or used to pay for non-law enforcement needs such as schools.

Even apart from federal equitable sharing arrangements, state and local jurisdictions have developed their own forfeiture programs and have netted millions in property. The total value of forfeited assets from all jurisdictions is unknown, but press accounts report that huge sums have been acquired. For example, between 1989 and 1992, the Sheriff's Office in Volusia County, Florida, seized $8 million in cash in roadside stops of motorists. Although the office returned about half of the money in settlements, it still retained $4 million over the three-year period.

Given the broad scope of modern forfeiture laws and the large sums that law enforcement agencies stand to keep for themselves, critics have charged that forfeiture decisions are driven more by the pursuit of revenue than legitimate law enforcement goals. They cite police tactics such as the reverse sting where police sell drugs to buyers, sometimes in drive-by transactions. The focus is on buyers, not suppliers. And the buyer will likely not be prosecuted, because the objective is the cash and the car. A New York City police commissioner explained why drug agents who work the I-95 drug corridor target suspects on the southbound lanes, and not those traveling northbound from Florida to New York City. Those traveling south are more likely to have drug proceeds while those traveling north are more likely to have drugs. Law enforcement can spend forfeitable cash; it must destroy contraband drugs.