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Covering Their Assets

After being exposed for violating the state's forfeiture law, Indiana officials scramble to codify their abuses.

Radley Balko
November 29, 2010

In March the Institute for Justice, a libertarian public-interest law firm, praised Indiana for curbing asset forfeiture abuses by assigning proceeds from seized property to the state's public schools instead of law enforcement agencies. But according to Indiana attorney Paul Ogden and The Indianapolis Star, only one of Indiana's 92 counties made any significant payments into the school fund from August 2008 to July 2010. That's because, as I reported in Reason last February and in a follow-up column in August, Indiana prosecutors have found several ways to get around the rule. And instead of cracking down on these evasive maneuvers, the state's attorney general is defending them, while the state legislature may codify prosecutors' current practice of keeping the money that is officially earmarked for schools.

One popular way Indiana prosecutors have avoided contributing to the school fund is to contract out civil forfeiture cases to private attorneys, who get to keep a quarter to a third of what they win in court. If there are incentive problems with letting police departments and district attorneys' offices keep forfeiture proceeds, those problems are magnified several times by allowing private attorneys to get paid directly from the forfeiture cases they bring on behalf of local governments. Forfeiture experts I've spoken with say the practice almost certainly violates the Constitution's Due Process Clause, since the people making decisions about these cases get a direct financial benefit from those decisions.

The Star recently reported that private attorney Christopher Gambill—who handles forfeiture cases for several western Indiana counties, including Putnam County, which brought the case that was the focus of my Reason feature—once made $113,146 from a single forfeiture case. That's more than all 92 Indiana counties paid into the school fund during the two-year period examined by Ogden and the Star. Yet it's a pittance compared to the $627,525 radio talk show host and celebrity attorney Greg Garrison earned by representing Madison County in a gambling forfeiture. In another case, a judge recently reprimanded Mark McKinney for earning commissions as Delaware County's private, contracted attorney in civil forfeiture cases while also serving as the county's prosecutor. 

Another loophole in the law allows prosecutors to deduct from forfeiture proceeds the law enforcement costs associated with obtaining them. County prosecutors and police departments exploit this provision by wildly exaggerating the costs of their investigations or interpreting the law in ridiculously broad ways. The Star reported, for example, that officials in Marion County "have a broader—and more lucrative—interpretation of law enforcement costs. They argue that the phrase simply means the cost of enforcing the law in Marion County, and thereby justify holding on to every dollar of the nearly $1.6 million the county received from state forfeiture cases in 2009."

Two weeks ago, Paul Ogden and his firm Roberts & Bishop announced a whistle-blower lawsuit on behalf of the state’s public schools against 72 Indiana county prosecutors over their misuse of forfeiture funds. Ogden is suing under the Indiana False Claims Act, a law that allows citizens to bring lawsuits on behalf of other citizens in the hope that the state attorney general will take over the case. But Indiana Attorney General Greg Zoeller also represents the state's prosecutors, and he has vowed to "zealously" defend them rather than help the citizens of Indiana reclaim misused forfeiture funds.

In a November 23 press release, Zoeller portrayed the controversy as arising from ambiguous language in the state's forfeiture law, as opposed to prosecutors' blatant misreading of the law, and said it should be settled in the legislature, not a courtroom. But the legislature's response may be just as wrongheaded as Zoeller's. Last week state Sen. Richard Bray (R-Martinsville)—a former prosecutor, a lawyer in private practice, and chairman of the Indiana Senate's Judiciary Committee—introduced a bill that would allow prosecutors to keep 70 percent of forfeiture proceeds, which they would divide with police departments. The remaining 30 percent would go to the schools, instead of the nearly 100 percent currently required by law. Bray's bill would change Indiana's forfeiture law from one of the country's best (on paper, at least) to one of its worst.

Bray says his bill would serve three goals: "First, we wanted to send the message that crime doesn't pay. Second, we wanted to alleviate the costs of prosecution and law enforcement. Third, we wanted to enhance Hoosier communities by giving back to our schools."

Notice what's missing from Bray's list. There is no mention of protecting the rights of property owners. There is no concern about the widely reported abuses of civil asset forfeiture. And there is no acknowledgement that the public officials charged with enforcing Indiana law have brazenly ignored it.

Radley Balko is a senior editor at Reason magazine. This column first appeared at Reason.com.


Radley Balko is Senior Editor


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