To the Governor: New Jersey Bill Reforms Asset Forfeiture, But Federal Loophole Remains

TRENTON, N.J. (Jan 17, 2019) – On Monday, the New Jersey Assembly gave final approval to a bill that would reform the state’s asset forfeiture laws to require a conviction in many cases. But the proposed law leaves a loophole in place allowing police to circumvent stricter state laws by passing cases off to the feds.

A coalition of six Democrats introduced Assembly Bill 4970 (A4970) on Jan. 28. Under the proposed law, the state could not proceed with asset forfeiture in without a criminal conviction in most cases involving $1,000 or less in cash, or non-cash property valued at $10,000 or less. Studies indicate a many asset forfeiture cases nationwide fall under these thresholds. For instance, according to the Mackinac Center for Public Policy, “The typical forfeiture in Michigan is just a few hundred dollars or a car valued at less than $2,000.”

In cases that do not require a criminal conviction, A4970 would raise the evidentiary standard to complete asset forfeiture from “a preponderance of evidence” to “clear and convincing evidence,” a much more difficult threshold to meet.

On May 23, the Assembly passed A4970 by a 70-2 vote. The Senate approved the measure on Monday by a 37-2 vote, and the Assembly concurred to some technical amendments, sending the legislation to Gov. Phil Murphy’s desk for his consideration.

A letter released by a coalition pushing for forfeiture reforms in New Jersey paints a bleak picture of current forfeiture law in the Garden State.

“Under civil forfeiture, law enforcement agencies can seize and then take title to cash, cars, and other valuables without charging anyone with—let alone convicting them of—a crime. Compounding these problems, New Jersey law does not require any forfeiture reporting. Instead, the Office of the Attorney General governs the reporting process through rulemaking and requires only the most basic details to be reported. And even those basic details are difficult to track down—the AG’s office does not compile aggregate reports, so interested parties must file lengthy and expensive Open Public Records Act requests to obtain the information. For example, the Institute for Justice recently requested from the AG’s office two years of counties’ and municipalities’ forfeiture reports, which cost IJ over $5,000 and took over 18 months to obtain.”

Murphy recently signed a second bill that would take the first step by imposing strict reporting requirements for all asset forfeitures in the state.

While A4970 would modestly reform New Jersey’s asset forfeiture process, it fails to close a loophole and withdraw the state from a federal program that allows police to circumvent the state forfeiture process altogether. This is particularly important in light of a policy directive issued in July 2017 by then-Attorney General Jeff Sessions for the Department of Justice (DOJ).

FEDERAL LOOPHOLE

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 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 can circumvent 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.

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.

New Jersey could close this loophole in most situations by effectively withdrawing from the federal program. We recommend the following language.

A local, county or state law enforcement agency shall not refer, transfer or otherwise relinquish possession of property seized under state law to a federal agency by way of adoption of the seized property or other means by the federal agency for the purpose of the property’s forfeiture under the federal Controlled Substances Act, Public Law 91 513-Oct. 27, 1970.under the federal Controlled Substances Act or other federal law.

In a case in which the aggregate net equity value of the property and currency seized has a value of $50,000 or less, excluding the value of contraband, a local, county or state law enforcement agency or participant in a joint task force or other multijurisdictional collaboration with the federal government (agency) shall transfer responsibility for the seized property to the state prosecuting authority for forfeiture under state law.

If the federal government prohibits the transfer of seized property and currency to the state prosecuting authority as required by paragraph (1) and instead requires the property be transferred to the federal government for forfeiture under federal law, the agency is prohibited from accepting payment of any kind or distribution of forfeiture proceeds from the federal government.

Failure to withdraw from the equitable sharing program could render the proposed forfeiture reforms virtually meaningless.

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

Gov. Murphy will have 45 days from the date it is transmitted to his office to sign or veto A4970 or it will become law without his signature.