The Department of Justice announced this week that it's suspending a controversial program that allows local police departments to keep a large portion of assets seized from citizens under federal law and funnel it into their own coffers.
The "equitable-sharing" program gives police the option of prosecuting asset forfeiture cases under federal instead of state law. Federal forfeiture policies are more permissive than many state policies, allowing police to keep up to 80 percent of assets they seize -- even if the people they took from are never charged with a crime.
The DOJ is suspending payments under this program due to budget cuts included in the recent spending bill.
"While we had hoped to minimize any adverse impact on state, local, and tribal law enforcement partners, the Department is deferring for the time being any equitable sharing payments from the Program," M. Kendall Day, chief of the asset forfeiture and money laundering section, wrote in a letter to state and local law enforcement agencies.
In addition to budget cuts last year, the program has lost $1.2 billion, according to Day's letter. "The Department does not take this step lightly," he wrote. "We explored every conceivable option that would have enabled us to preserve some form of meaningful equitable sharing. ... Unfortunately, the combined effect of the two reductions totaling $1.2 billion made that impossible."
Asset forfeiture has become an increasingly contentious practice in recent years. It lets police seize and keep cash and property from people who are never convicted — and in many cases, never charged — with wrongdoing. Recent reports have found that the use of the practice has exploded in recent years, prompting concern that, in some cases, police are motivated more by profits and less by justice.
Criminal justice reformers are cheering the change. "This is a significant deal," said Lee McGrath, legislative counsel at the Institute for Justice, in an interview. "Local law enforcement responds to incentives. And it's clear that one of the biggest incentives is the relative payout from federal versus state forfeiture. And this announcement by the DOJ changes the playing field for which law state and local [law enforcement] is going to prefer."
Previous research by the Institute for Justice has shown that when states have stricter forfeiture laws, cops are more likely to pursue forfeiture cases under federal law as a means of bypassing those stricter state restrictions.
In California, for instance, police are allowed to keep 66.25 percent of forfeiture proceeds under state law, but 80 percent if they opt for the federal equitable sharing route. And forfeiture figures reflect this: In 2013, California police forfeited $28 million worth of cash and property under state law, but $98 million under federal law, according to the Institute for Justice's research.
It's unclear how much of the total national forfeiture haul will be affected by the DOJ's change, since many states don't make their forfeiture data public. But as the case of California shows, it is potentially significant: In that state in 2013, nearly eight out of every 10 dollars of forfeited property went through federal law. Under this change, that flow of cash would be shut off.
Some law enforcement groups are less than happy with the change. The International Association of Chiefs of Police (IACP) said in a statement that "this decision is detrimental to state, local, and tribal law enforcement agencies and the communities they serve."
In a letter sent to President Obama, the leaders of Congress, and Attorney General Loretta Lynch, the heads of six law enforcement groups -- including the IACP and the National District Attorney's Association -- wrote to express "profound concern" over the changes: "This shortsighted decision by Congress will have a significant and immediate impact on the ability of law enforcement agencies throughout the nation to protect their communities and provide their citizens with the services they expect and deserve."
The National Sheriff's Association was even more critical. "While Congress and the President vacation in peace and tranquility, law enforcement knows all too well that the criminals, terrorists, and criminal aliens do not take a holiday," the group wrote in a statement. "Those seeking to do us harm can rest easier knowing one less tool can be used against them."
But reformers point out that the change doesn't impact law enforcement's ability to seize goods from suspected criminals -- it only changes their legal options for keeping what they take. The change "does not stop police and prosecutors from chasing criminals," McGrath said in a statement. "[Police] are frustrated because Congress put on hold their chasing cash."
Regardless, the change may not 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.
Update: This story was updated at 7:00 PM with comments from six law enforcement groups and a statement from the National Sheriff's Association.