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Upstate NY police seize $8.5 million in assets a year without having to prove a crime

January 15, 2016

John O’Brien


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Seized vehicleJustin Lucas gathered up $50,000 in cash in 2011 to bail his brother out of jail on a drug charge.

But when Lucas brought the money to the Otsego County jail in a brown paper bag, sheriff’s deputies seized the cash without releasing his brother. They told him the money was the subject of a drug investigation.

How much did your police agency get? Check out our national database (below).

Lucas’ brother eventually pleaded guilty to a felony marijuana possession charge. But even with the case over, Lucas couldn’t get his money back. The sheriff’s office had already used a federal law to force him to forfeit the money to the government.

Investigators cited the fact that their drug-sniffing dog picked up the scent of marijuana on the cash, and Lucas’ admission that $10,000 of it had come from his brother’s co-defendant.

The federal civil asset forfeiture law allows local police to get up to 80 percent of money or property seized, with the rest going to the federal government for their role in the investigations and for administering the program.

Lucas’ case was among 117 in the 32-county Northern District of New York over the past five years in which the federal government used the law to seize $43 million in assets without having to charge the owners with a crime.

The Justice Department announced last month that it was shutting down the program, at least temporarily, under which the seized assets are shared among the police agencies involved in investigations. Federal officials cited budget constraints.

New York state seized more assets per capita under the civil asset forfeiture law than all but one other state in 2014. Police have been criticized for abusing the law to get quick access to money that they spend on new equipment, training and other expenses. They’re not allowed to use the money to pay salaries.

A Syracuse lawyer who specializes in fighting civil asset forfeitures says prosecutors in the Northern District of New York use the law fairly.

The bail seizure in Otsego County was an exception, according to Nicholas Lucas’ lawyer, Wayne Smith.

“A law-abiding citizen posts bail and they seize it? I mean, it’s outrageous,” Smith said. “In a case where a brother bails out a brother under the facts of this case, it not only doesn’t pass the laugh test – it pisses you off a little because it could happen to anybody.”

Nicholas Lucas took the case to court, but U.S. District Judge Gary Sharpe ruled he didn’t have standing to get the money back.

Smith appealed, and the case was argued in January. In unheard-of turnaround time, the 2nd U.S. Circuit Court of Appeals overturned the lower court’s ruling the day after the lawyers argued the case in court.

“They apparently felt strongly about what was done here,” Smith said.

After that, federal prosecutors dropped the case and returned the money to Nicholas Lucas. The police had held onto it for nearly four years.

The prosecutors cited a new policy issued in January 2014 from then-Attorney General Eric Holder that was designed to combat the growing criticism that the civil asset forfeiture law was being abused by police across the country.

“Because of the change of policy, we decided it would not be a case we would take, so we gave the money back,” said Assistant U.S. Attorney Tamara Thomson, who handles civil asset forfeiture cases in Syracuse.

Otsego County Sheriff Richard Devlin declined to comment.

The bail case appears to be an anomaly in the 32-county Northern District of New York, according to a defense lawyer who handles almost all of the cases in Central New York. For the most part, federal prosecutors in the Syracuse area handle the cases fairly, said Dana VanHee, who advertises himself as “the forfeiture lawyer.”

Revenue from alleged criminal activity

This is the asset forfeiture revenue for the Department of Justice and the Department of the Treasury for the fiscal years 2001-2013. The money and goods are seized undet the premise that they were obtained by illegal activities, and therefore, are subject to seizure by law-enforcement agencies. The revenue is split 80/20 with the larger portion going to the agency that seized the goods and money. The other 20 percent pays for the administration of the seizure programs.

seized_money_property_by_police The law invites abuse by police because they stand to get a chunk of the seized assets, he said.”Instead of investigating first, they take, then investigate,” VanHee said. “It’s a great incentive to seize assets.”

Over the past five years, federal prosecutors in the Northern District have used the law to seize $43 million in cash, cars, homes and oddities such as an antique coin collection worth $17,000.

That’s $8.5 million a year, and $367,000 per case, that was divvied up among police agencies who played a part in the investigations that led to the seized assets.

In 2014, New York state ranked second in the country in the amount of assets the federal government seized, with $76 million received. California was first with $77 million, according to data from the Justice Department’s equitable sharing program.

New York was also second in the U.S. in the amount it seized per 100,000 residents – $39,292. Rhode Island was first at $161,760.

New York state police had the biggest haul in the state in 2014 — $27.6 million, according to data from the U.S. Department of Justice.

The upstate New York agency that got the most in 2014 was the Watervliet Police Department near Albany, with $1.4 million. The Onondaga County Sheriff’s Office got the most of any Central New York police agency, with $421,282.

The Syracuse Police Department got $333,729.

The law allows police and prosecutors to hit criminals where it hurts the most, Thomson said.

“It’s a critical law enforcement tool,” U.S. Attorney Richard Hartunian said. “It allows us to reclaim proceeds of crime or property used to commit crime and thereby takes the incentive out of criminal behavior.”

Under the federal law, law enforcement agencies such as the FBI or DEA can seize someone’s property without charging him or her with a crime. The law allows the government to take the property, then requires the owners to prove their possessions were legally acquired.

For police to keep someone’s assets, they have to be able to prove only that it’s more likely than not that the money or property was used to commit a crime or was the proceeds of a crime. That’s lower than the standard for convicting someone of a crime – “beyond a reasonable doubt.”

If federal prosecutors agree with the law enforcement agency’s decision, they file a civil lawsuit against the property, not the owner. That’s why the lawsuits have odd captions, such as “United States of America vs. One 1999 Chevrolet Pickup Truck.”

Over the past five years, federal prosecutors have declined 69 requests from law enforcement agencies to file a civil asset forfeiture lawsuit. Prosecutors wouldn’t comment on why they turned down those cases.

The owners of the seized property can submit a claim to get it back. If they can prove the police were wrong, the government gives the assets back and can be ordered to pay the property owner’s legal fees.

But the property owners often don’t contest the seizure. Most people are afraid to file a claim for fear the government will come after them again, said VanHee, who has a web page dedicated to the issue:

A few who did file a claim ended up getting some or all of their property back. One of VanHee’s clients, William Sullivan of East Syracuse, had $62,000 seized by the DEA in a cocaine investigation in 2011. Federal prosecutors sued the money.

Sullivan wasn’t charged with a crime. He contended he had the money at his home because he owned rental properties and his tenants paid him in cash, VanHee said. The feds gave him all his money back after he filed a claim.

“He was a year without the money,” VanHee said. “It was a hardship.”

Two of VanHee’s clients in the Western District of New York are fighting to get back cash seized by police at the Buffalo airport this year. The only reason investigators gave for the seizures was that a police dog alerted to the smell of drugs on the cash in both cases, VanHee said.

One of the men is a professional gambler who was carrying $45,730 because he was traveling to a poker tournament in Las Vegas, VanHee said. The other is a California fisherman who came to Western New York to retrieve $49,900 that someone owed him, VanHee said.

The cash might have been in the hands of a drug-user long before either man had it, which would explain the drug-sniffing dog hitting on it, he said. Neither man had a criminal history, he said.

“I can’t think of two cases where the merits have been just so in favor of the claimant,” VanHee said.

The federal prosecutors handling those cases could not be reached.

Federal prosecutors in the Northern District, which includes Syracuse, are more reasonable in assessing civil asset forfeiture cases, VanHee said.

“We take great care in our district to work with our law enforcement agencies to fairly apply the asset forfeiture laws,” Hartunian said.

The law has been around for years. But it wasn’t until 1984 that the statute allowed the police agencies that seized the property to keep a large portion of the proceeds.

“All of a sudden, it became a fundraising thing,” said Brenda Grantland, a lawyer in Marion, Calif., who has been taking on the government in civil asset forfeiture cases for years.

In 2000, Congress passed the Civil Asset Forfeiture Reform Act in response to news reports about local police agencies abusing the law. The law placed new time constraints on the government and created an “innocent owner” defense. But it also enhanced government’s ability to use seized assets as a weapon against crime.

The amount of seized assets continued to rise.

In 2001, the total amount seized across the U.S. was $479 million. By 2012, the seizures had increased 10 times, to $4.5 billion.

Grantland cites cases where the government had no basis for seizing assets, such as a small county police agency in California grabbing $2 million from a lawyer’s bank account because he was an activist for medical marijuana. The money was later returned.

“It’s become a lot more like extortion than it was in the 1990s,” Grantland said.
In the Northern District of New York, the law has allowed the government to make big asset hauls without having to prove a crime.

The biggest case was against IFCO Systems, a pallet-making company that was accused of hiring 6,000 undocumented immigrants at 45 plant in 26 states. The government’s take in that case was $18 million. Sixteen defendants were convicted of crimes.

In most cases, criminal charges are also filed.

A criminal case against Albany-area gamblers netted the government $10 million through civil asset forfeitures and criminal forfeitures.

And the civil asset forfeiture law resulted in the return of 6th century artifacts to their homeland last year. U.S. Customs and Border Protection agents seized the two figurines, worth a total of $55,000, from a Canadian businessman as he entered the U.S. in northern New York.

The figurines were found in 2002 in a clandestine archaeological dig by a man known for illegal art-trafficking, who sold them to the Canadian businessman, court papers said.

After federal prosecutors closed their case, the figurines were returned to the Italian government.

Prosecutors used the law in 2010 to seize $6,304.59 from an inmate’s commissary account at the Cape Vincent Correctional Facility. The money was the proceeds of the inmate selling drugs in jail that people had smuggled in to him.

The law was used in 2011 to seize a 2003 Mercedes-Benz Roadster SL5 after Roy Brown was charged with dealing drugs in it. Brown had bought the car with some of the $2.6 million the state paid him in 2009 for the 15 years he’d spent in prison for a murder someone else committed.

The government sold the Mercedes at auction for $28,900.

In addition to the asset seized under civil law, another $41 million was seized in the Northern District over five years through criminal asset forfeiture — criminal cases in which the forfeiture was part of the indictment.

In the Otsego County bail case, prosecutors decided to return the money because no federal agency was involved in the investigation before the seizure. Before the money was returned, the Otsego County Sheriff’s Office stood to get $40,000 of it.

Holder’s new policy directed prosecutors to only adopt local police cases in which a federal agency or task force was involved.

It was the attorney general’s reaction to horror stories of seemingly unwarranted seizures across the country that mostly resulted from roadside stops by local police agencies, said Thomson, the federal prosecutor who handles the forfeiture cases in the Syracuse area.

“This is a hot topic,” she said. “People are debating it. The concern is that it’s paid-for policing. So our department as a whole made sure we came down on the adoptions (of local police cases) we were taking and took very proactive steps to make sure we limit that.”

In state court, where few forfeiture cases are filed, criminals are often sentenced for their crimes but aren’t held accountable for the illegal profits they earned, Thomson said.

“By using these tools,” she said, “we’re taking the profit out of crime and making a deterrent.”

Smith, the lawyer who fought to get Nicholas Lucas’ bail money returned, said he got calls from lawyers across the country after the federal appeals court ruled in his favor. That’s how unusual it is to win these cases, he said.

“They were saying, ‘Oh my god, we never saw anything like that,'” Smith said. “It’s because most people are poor and downtrodden. They don’t have the money to go to the second highest court in the country to get their money back. Everybody else walks away from it.”

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