Virginia House Passes Bill to Reform Asset Forfeiture Laws, Federal Loophole Remains

RICHMOND, Va. (Feb. 16, 2018) – Last Friday, the Virginia House approved a measure that would reform the state’s asset forfeiture laws, making it more difficult for police to seize property. But a loophole would allow prosecutors to circumvent the more stringent state law by passing cases to the federal government.

Rep.Nicholas J. Freitas (R-Culpeper) introduced House Bill 900 (HB900) on Jan. 9. Under the proposed law, the state would not be able to initiate asset forfeiture proceedings until the person whose property is the subject of the action has been found guilty of the crime authorizing the forfeiture. The bill would allow forfeiture without a guilty verdict “if (i) the forfeiture is ordered by the court pursuant to a plea agreement or (ii) the owner of the property has not submitted a written demand for the return of the property within 21 days from the date the property was seized.”

On Feb. 9, the House passed HB900 by an 81-18 vote.

The Institute of Justice called Virginia’s current asset forfeiture laws “some of the worst in the nation.

“In order to forfeit property in Virginia, the government need only show by a preponderance of the evidence that property is related to criminal activity. Innocent owners also bear the burden of proving that they had nothing to do with the alleged criminal activity in which their property has been implicated. Worst of all, Virginia law provides a tempting incentive to seize property as it allows law enforcement to retain 100 percent of forfeiture proceeds: Participating agencies keep 90 percent of the bounty, while the balance goes to the state’s Department of Criminal Justice Services.”

The proposed legislation does not address the “policing for profit” incentives under the current law.

FEDERAL LOOPHOLE

HB900 would significantly reform of Virginia’s asset forfeiture laws and would go a long way toward protecting the rights of property owners. But the legislation leaves a loophole that could render the reforms virtually ineffective in practice. The bill needs to include amendment language to stop state and local law enforcement from turning cases over to the federal government, thereby circumventing any restrictions placed on asset forfeiture at the state level. 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).

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.

We recommend the following language to close the loophole.

  1.  A law enforcement agency or prosecuting authority may not enter into an agreement to transfer or refer seized property to a federal agency directly, indirectly, by adoption, through an intergovernmental joint taskforce or by other means for the purposes of forfeiture litigation and instead must refer the seized property to appropriate local or state prosecuting authorities for forfeiture litigation under this chapter unless the seized property includes U.S. currency in excess of $100,000.
  1. This paragraph preempts laws by township, municipal, county and other governments in the state which regulate civil and criminal forfeiture.

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.

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

HB900 is now under consideration in the Senate. It has already passed the Committee on Courts and Justice by a 12-2 vote. It now moves to the Senate Finance Committee where it must pass by a majority vote before moving forward in the legislative process.

About Tenth Amendment Center
The Tenth Amendment Center is a national think tank that works to preserve and protect the principles of strictly limited government through information, education, and activism. The center serves as a forum for the study and exploration of state and individual sovereignty issues, focusing primarily on the decentralization of federal government power as required by the Constitution. For more information visit the Tenth Amendment Center Blog.

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