North Carolina should limit use of federal program that threatens property rights

October 30, 2017

RALEIGH — North Carolina should take steps to stop state and local law enforcement agencies from working with the federal government in civil asset forfeiture “equitable sharing” programs. Those programs threaten North Carolinians’ property rights.

That’s the primary message in the latest John Locke Foundation Spotlight report. It’s the first part of a three-part series on the negative impact of civil asset forfeiture.

“While North Carolina has some of the nation’s best state-level asset forfeiture laws, we’re among the worst offenders when it comes to working with the federal government through equitable sharing to accomplish the same ends,” said report author Jon Guze, JLF Director of Legal Studies. “The best solution for North Carolina and the rest of the country would be for the federal government to cut back or even abolish its civil asset forfeiture programs, including equitable sharing,”

“But it would be a mistake to wait for reform to happen at the federal level,” Guze said. “It falls to the states to do what they can under their own state laws to protect their citizens from asset forfeiture abuse. For North Carolina, that primarily means introducing statutory restrictions on law enforcement agencies’ ability to participate in federal equitable sharing programs.”

Civil asset forfeiture is a legal process that allows law enforcement agencies to confiscate property that law enforcement officers suspect has been used for or derived from criminal activity, Guze explained.

“The owner of the property need not be charged with, let alone convicted of, committing a crime,” Guze said. “In fact, the owner need not even be a suspect to have his property seized.”

Guze’s report offers the example of a Durham homeowner who had her home confiscated because her son was suspected of selling cocaine from the property. The mother never was charged with any crime.

“To recover property seized through civil asset forfeiture, owners must initiate an expensive and time-consuming lawsuit,” he said. “The property owners bear the burden of proving that the property was not used or acquired in an impermissible way.”

The standard of proof adds to the problems for affected property owners, Guze said. “In a criminal trial, the state must prove its case ‘beyond a reasonable doubt,’ but the standard is much lower in a civil asset forfeiture case,” he said. “The standard is called ‘preponderance of evidence.’ All the government must do is persuade a court or jury that the claimed link between the property and a crime is slightly more likely than not.”

Law enforcement agencies have used civil asset forfeiture to generate money for their departments, Guze explained. “It tends to pervert the proper relationship between the police and the public,” he said. “It turns the former into predators and the latter into prey. Allowing law enforcement agencies to self-fund their operations by taking property directly from the citizens creates perverse incentives and encourages abuse.”

North Carolina has exercised “wisdom and good sense” in enacting laws that prevent most civil asset forfeiture at the state level, Guze said. “The advocacy group FreedomWorks gave North Carolina the second-highest score in its grade card of state civil asset forfeiture laws,” he said. “North Carolinians can be justifiably proud of our state’s asset forfeiture laws.”

Article IX, Section 7 of the state Constitution helps explain North Carolina’s reluctance to embrace civil asset forfeiture as a law enforcement tool, Guze said. That constitutional provision requires that money from penalties and forfeitures must head to public schools.

“This provision removes the incentive for asset forfeiture abuse and discourages the kind of predatory policing that has poisoned relations between the police and the public in many parts of the country,” Guze said.

That’s the good news. The bad news is that North Carolina law enforcement agencies have turned to federal equitable sharing programs, Guze said. Under these programs, a state or local agency seizes property and turns it over to a federal agency for legal processing. “After taking a cut for their services, typically 20 percent, the feds return the remainder of the proceeds to the agency that made the seizure.”

Since 2011, the total amount of equitable sharing proceeds returned to state and local agencies across the United States has exceeded $500 million every year. Between 2007 and 2016, North Carolina state and local law enforcement agencies collected more than $170 million in equitable sharing proceeds from the U.S. Departments of Justice and Treasury.

“North Carolina law enforcement agencies have been particularly aggressive about using equitable sharing to supplement their taxpayer-approved funding,” Guze said. “As a result, the Institute for Justice ranks North Carolina among the very worst states when it comes to federal asset sharing.”

Federal reform efforts have had limited results, Guze said. “Legislation to reform federal asset forfeiture laws has gone nowhere, and U.S. Attorney General Jeff Sessions has reversed modest cutbacks in equitable sharing adopted in 2015.”

That’s why it’s important for states like North Carolina to enact their own safeguards of private property rights, Guze said. “Civil asset forfeiture is inherently unjust, not to mention a violation of due process,” he said. “One constitutional scholar has described it as ‘a civil-rights debacle and a stain on American justice.’”

Jon Guze’s Spotlight report, “Preventing Asset Forfeiture Abuse in North Carolina: How Federal Asset Sharing Puts Innocent Property Owners at Risk,” is available at the JLF website. For more information, please contact Guze at (919) 828-3876 or [email protected]. To arrange an interview, contact Mitch Kokai at (919) 306-8736 or [email protected].