Asset Seizure Out-of-Control in Michigan

Piracy in the Great Lakes State – Asset Seizure Out-of-Control in Michigan

Police Departments Run Wild
We’ve all seen those news reports about drug busts in our neighborhoods where local law enforcement, often working with federal agencies, boast about the seizure of money, vehicles, guns, knives and electronics, along with a modest amount of a controlled substance intended for sale.
From the over-sensationalized reporting, one would think the cash, computers, cars, and weapons are key elements to an enormous criminal drug trafficking operation and that’s why they’re being confiscated — as an urgent matter of public safety.
Not always so though. Increasingly, it’s the cops and prosecutors who are truly breaking bad.
The seized items more accurately fall into the category of trophies, booty, spoils, loot — to be split among agencies, and they may be used for most any purpose, not just for fighting the “war on drugs”.
In a recent report, Michigan State Police Annual Asset Forfeiture, we learn some of the numbers, but not all. Although mandated by law, 56 agencies failed to disclose their takings in 2012. Of those that complied, a total seizure of $26.5 million in private assets was reported last year which, after administrative costs, left a tidy $22.4 million to be divvied-up among 286 agencies, most of them small local police departments, but Detroit area law enforcement hauled in over 1 in 5 dollars taken in the state.
The MSP report explains:
“The primary goal of asset forfeiture is to deter and punish criminals by taking away the goods, property, and money obtained through illegal activity.”
Sounds fair enough. But in practice, that reassuring claim stretches credulity in numerous ways.
First, under current law, agencies may seize and liquidate assets without a conviction, and in some cases, without charges ever being brought. Michigan is not unique in this legislatively codified abuse of power, but it is one of the states where the practice has become rampant. With public sector budgets being slashed under the Snyder administration, law enforcement agencies have turned to increasingly creative means of revenue enhancement. Asset seizure loot is rapidly becoming a growing portion of the budgets of many agencies. Needing a steady revenue stream, they manage to find funding by any quasi-legal means – MSP makes no bones about it:
“Due to the unpredictable nature of forfeiture levels and trends, asset forfeitures will never replace state and local law enforcement appropriations. However, these funds serve as an important supplement and adjunct to enhance ongoing enforcement programs.”
The Fix
In an ideal world, to prevent the abuse of authority by these modern-day privateers, law enforcement budgets would be uncoupled entirely from asset seizure revenues. That is an unlikely policy initiative.  At the very least then, Michigan must halt arbitrary forfeitures where no crime has been proven.
jeff irwin
On Jan. 8th, Rep. Jeff Irwin (D-53) will be introducing HB-5213, an amendment to Public Act 368 of 1978, to require a criminal conviction before property can be forfeited. Although the proposal is expected to enjoy broad bipartisan support in the legislature, Irwin told Democracy Tree he anticipates vigorous challenges from law enforcement agencies who are dependent on forfeiture revenues.
Irwin explained “Asset forfeiture is a tool they want to use, to have in their arsenal.” He characterized the practice of seizure without a conviction as a “dangerous incentive inherent in the system” and a “violation of the fundamental principle of innocent until proven guilty.”
The lawmaker described increased abuses by law enforcement agencies in Michigan that are aggressively confiscating equipment and assets of medical marijuana growers who are acting perfectly within the law. These individuals are afraid to challenge a seizure because they’re already feeling overwhelmed by threats of criminal prosecution. Indeed, the MSP proudly reports that agencies across the state have generously donated 79 plant growing lights and 81 weight scales to public school science classrooms in 2012. (Note: they didn’t share any of the cash taken.)
A Dangerous Incentive
Another serious problem with the current law is the recently expanded allowable usage of funds obtained through asset forfeiture. The change incentivizes all departments within an agency to support the unchecked marauding practice of a few bad actors. Money is used to meet payroll and overtime demands. It buys vehicles, supplies and equipment. Everyone, from the janitor to chief of police, including the local prosecutor, stand to benefit from increased forfeitures.
The American Civil Liberties Union concurs:
“In many jurisdictions, the money can go to pay for salaries, advanced equipment and other perks. When salaries and perks are on the line, officers have a strong incentive to increase the seizures, as evidenced by an increase in the regularity and size of such seizures in recent years.”
In Michigan, based on reported spending patterns, we can see where law enforcement priorities truly lie. Among multiple allowable uses of forfeiture dollars, only 19 agencies bothered to invest their bounty in “crime prevention and outreach” programs, while 46 agencies used it for “informant fees” and 74 spent it on “buy money” for the undercover purchase of drugs. The bulk of the money went to buy equipment, primarily newer technology — 170 agencies reported upgrades to their gadgetry from their loot money.
Short-cuts to Bypass the Courts
In 2012, fully 89 percent of Michigan forfeitures were administratively “streamlined” — meaning they flew under the judicial radar because the asset value did not exceed the $50,000 threshold which triggers court oversight. Michigan agencies availed themselves of this provision 9148 times last year. The MSP report indicated that few of these seizures were challenged, and further made the outrageous leap in reasoning to state that this was due to presumed guilt:
“Drug dealers do not contest many of these cases, as they often do not have a sufficient legitimate source of income to have legally obtained the property seized.”
Among the 1177 cases which exceeded the dollar threshold that were adjudicated, only 678 were concluded according to the MSP report.
It’s About Color
In terms of actual dollars, most of these types of seizures are small potatoes, and they often occur along racial lines. From marijuana to other controlled substances, police disproportionately target non-whites. The ACLU frames the abuses as a civil rights issue:
Asset forfeiture practices often go hand-in-hand with racial profiling and disproportionately impact low-income African-American or Hispanic people who the police decide look suspicious and for whom the arcane process of trying to get one’s property back is an expensive challenge.  ACLU believes that such routine “civil asset forfeiture” puts our civil liberties and property rights under assault, and calls for reform of state and federal civil asset forfeiture laws.
Yet, the IRS Remains Colorblind 
Asset seizure has a certain equal opportunity aspect to it for the taxman. Fair is fair. Running a business that operates primarily on a cash-only basis is plenty enough reason to look suspicious to the feds.
Michigan is fast becoming the Somalia of the United States — a place where asset piracy is the norm. Smelling blood in the water, the IRS, acting under expanded powers found in the Patriot Act, can now seize bank accounts on a mere whiff of suspicion that money is being laundered. The Bank Secrecy Act requires financial institutions to report cash transactions in excess of $10,000, but now the IRS is looking at lesser amounts claiming the accused is attempting to skirt the law with multiple smaller deposits. Earlier this month The Detroit News editorialized on IRS overreach in Michigan. They found that, in one year, the IRS seized about $500 million in deposits from Michigan residents. Several cases of bank account forfeiture recently made the news when the court ordered the return of the money, but the victories were won on a technicality, and did nothing to strike down the widespread practice of unwarranted seizure.
While the state may not be able to halt federal abuses, they certainly should get their own house in order.
Michigan lawmakers must reign-in local and state law enforcement — they certainly don’t seem to be able to control themselves. Irwin suggested that it’s time for the state to examine new revenue models for financing our public sector so they aren’t forced to rob those they are entrusted to protect.
If these abuses were occurring in another country, our media would report them as an outrageous affront to personal liberty. Not so here in America, where reporters applaud these seizures under the guise of successful law enforcement and a false sense of protection for our communities.
Amy Kerr Hardin

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