Iowa Legislation Takes on “Policing for Profit” via Asset Forfeiture; Closes Federal Loophole

DES MOINES, Iowa (Feb. 16, 2016) – An Iowa bill would reform asset forfeiture laws to prohibit the state from taking property without a criminal conviction. The legislation also takes on federal forfeiture programs by banning prosecutors from circumventing state laws by passing cases off to the feds in most situations.

Sen. Charles Schneider (R-Des Moines) introduced Senate Bill 2166 (SB2166) on Feb. 11. The legislation would reform Iowa law by requiring a criminal conviction before prosecutors could proceed with asset forfeiture. Under current law, the state can seize assets even if a person is never found guilty of a crime, or even arrested.

The bills would also require funds procured through asset forfeiture to be deposited into the state general fun instead of going to law enforcement agencies. Under current law, law enforcement agencies keep 100% of asset forfeiture money. This provision curbs the policing for profit motive inherent in the current law.

ADDRESSES FEDERAL PROGRAMS

SB2166 also close a loophole that allows prosecutors to bypass more stringent state asset forfeiture laws by passing cases off to the federal government under its Equitable Sharing forfeiture program.

“A law enforcement agency, joint taskforce of any kind, or prosecuting authority shall not directly or indirectly, transfer or refer seized property to any federal agency unless the seized property includes seized United States currency in excess of fifty thousand dollars.”

In other words the legislation does not attempt to interfere with federally initiated forfeiture, but bans state and local police from passing off their cases to federal jurisdiction in most cases.

The inclusion of provisions barring state and local law enforcement agencies from passing off cases to the feds is particularly important. In several states with strict asset forfeiture laws, prosecutors have done just that. By placing the case under federal jurisdiction, law enforcement can bypass the need for a conviction under state law and collect up to 80 percent of the proceeds from forfeited assets via the federal Equitable Sharing Program.

Late last December the U.S. Department of Justice suspended the Equitable Sharing Program due to budget cuts. But as the Washington Post reported, the suspension won’t likely be permanent.

“In its letter, the DOJ hints that it may be able to restart payments later: ‘By deferring equitable sharing payments now, we preserve our ability to resume equitable sharing payments at a later date should the budget picture improve.’ The DOJ hopes to ‘reinstate sharing distributions as soon as practical and financially feasible,’ the letter concludes.”

Even with the program suspension in place for now, the prohibition from passing off cases remains an important provision.

California prosecutors and law enforcement agencies have regularly utilized this loophole. As previously reported by the Tenth Amendment Center, the federal government has inserted itself into the California’s asset forfeiture debate. 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 deplorable “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.

Asset forfeiture laws incentivize “policing for profit” on one hand, and dubious state-federal partnerships on the other.

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SB2166 was referred to Senate Judiciary Committee where it will need to pass by a majority vote before moving on to the full Senate for further consideration.