Legal Plunder: Civil Asset Forfeiture in North Dakota

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Legal Plunder: Civil Asset Forfeiture in North Dakota LEGAL PLUNDER: CIVIL ASSET FORFEITURE IN NORTH DAKOTA Released April 2018 Researchers: Raheem Williams, M.A. Table of Contents INTRODUCTION .................................................................... 3 BACKGROUND ...................................................................... 3 NORTH DAKOTA ................................................................... 4 CURRENT LAW ............................................................................. 4 TRACKING CIVIL ASSET FORFEITURE............................................ 5 LEGISLATIVE REFORM .................................................................. 5 CONCLUSION ........................................................................ 6 REFERENCES ......................................................................... 7 “It is impossible to introduce into society a greater change and a greater evil than this: the conversion of the law into an instrument of plunder.” – Frédéric Bastiat 1 1 Bastiat, Frederic. (1850). The Law. Library of Economics and Liberty. Retrieved from http://econlib.org/library/Bastiat/basLaw.html 2 Introduction Secure private property rights encourage economic growth. Studies have found that nations that protect private property rights experience more economic growth (Knack & Keefer, 1995; Leblang, 1996; Svensson, 1998; Weingast, 1995). Therefore, ensuring a strong system of private property rights and protections should be considered a pre-requisite to achieving growth and higher living standards. Modern civil asset forfeiture practices weaken private property rights by allowing the state to seize property without due process or public transparency. While these laws were originally intended to help police crackdown on organized crime, they create perverse economic incentives that can lead to abuse. A renewed focus on this issue by national organizations has sparked citizen protection reforms in some states, but meaningful reforms have not been enacted in North Dakota. With civil asset forfeiture laws that heavily favor law enforcement, the strength of North Dakota’s private property rights could be in question. This policy paper will review the definition of civil asset forfeiture, clarify the laws in North Dakota, examine recent legislative attempts at reform, and, finally, make policy recommendations. Background Civil asset forfeiture is a legal procedure that allows law enforcement officials at various levels of government to seize private property without due process. It was first introduced to the rule of law through a series of early Supreme Court cases involving illegal trade (The Palmyra, 1827; United States v. The Brig Malek Adhel, 1844). It was intended to help law enforcement restrict trade related to illicit activities and fight organized crime. Ideally, the Fifth Amendment’s due process clause would protect citizens against unlawful civil asset forfeiture (Cheh, 1998; Kim, 1997; Piety, 1990; Ross, 2000). In reality, civil asset forfeiture opens the door to corruption and policing for profit. The constitutionality of this practice has been increasingly scrutinized by leading legal advocacy organizations across the political spectrum, including the American Civil Liberties Union and the Institute for Justice. Law enforcement abuses are being exposed with greater frequency due to the work of these legal watchdog groups, leading states to weigh the benefits of civil asset forfeiture against upholding citizens’ constitutional liberties. 3 North Dakota In a national study of state civil asset forfeiture laws by the Institute for Justice, North Dakota tied for worst in the country, receiving an “F” grade for citizen protections (Institute for Justice, 2014). North Dakota state law only requires “probable cause” to seize assets. This is the lowest possible standard of proof for government seizures (Institute for Justice, 2014). Additionally, when property is seized for illegal activity without the owner’s knowledge, the burden of proof is placed on the owner to prove his or her innocence in order to recover the seized property. If the notion of “innocent until proven guilty” is to be preserved, the burden of proof should be on the state. Current Law Chapter 29-31.1 of the North Dakota Century Code defines forfeitable property as: a. Property that is illegally possessed or is contraband. b. Property that has been used or is intended to be used to facilitate the commission of a criminal offense or to avoid detection or apprehension of a person committing a criminal offense. c. Property that is acquired as or from the proceeds of a criminal offense. d. Property offered or given to another as an inducement for the commission of a criminal offense. e. A vehicle or other means of transportation used in the commission of a felony, the escape from the scene of the commission of a felony, or in the transportation of property that is the subject matter of a felony. f. Personal property used in the theft of livestock or the transportation of stolen livestock (N.D. Cent. Code §§ 29-31.1-10, 1991 & 2009). This broad definition allows the state almost unlimited power to confiscate property. The law in its current form allows law enforcement to make judgment decisions on the “intended use” of property. It also allows the sale of seized assets and the retention of the proceeds from such sales (Williams, 2002). Agencies in North Dakota receive up to 100 percent of civil asset forfeiture proceeds, and if the forfeiture fund exceeds $200,000 during the two-year budgetary period, excess proceeds are deposited in the General Fund (Institute for Justice, 2014). This creates a use-it-or-lose incentive that could encourage the seizure of assets (Institute for Justice, 2014). 4 In its current form, North Dakota’s civil asset forfeiture law tips the scale too far in favor of law enforcement. While there is no evidence that law enforcement officials are abusing this power, there is a troubling lack of transparency. Tracking Civil Asset Forfeiture The North Dakota Century Code does not require local law enforcement to track civil asset forfeiture proceeds, making it difficult to understand the degree to which North Dakotans are affected. The most accessible data available comes from the Department of Justice, which tracks the use of Equitable Sharing Agreements (ESA). ESAs outline how the proceeds of civil asset forfeitures are split between local, state, and federal law enforcement in cases involving multiple agencies (Carpenter, Salzman, & Knepper, 2011). A quick look at the data compiled from the Department of Justice shows that North Dakota law enforcement rarely utilize ESAs. The state received only $550,483 in equitable sharing proceeds from 2000-2013. This makes North Dakota the second best state in terms of federal civil asset forfeiture, according to rankings by the Institute for Justice (Carpenter, Knepper, Erickson, & McDonald, 2015). However, this seemingly good news could be deceptive. North Dakota’s civil asset forfeiture laws are favorable enough to local and state law enforcement that there is little incentive to collaborate with federal officials. In theory, local law enforcement keep more of the proceeds from asset forfeiture by not including federal law enforcement. Legislative Reform In order to discourage the possibility of abuse, H.B. 1170 was introduced during the most recent legislative session (North Dakota Legislative Assembly, 2017a, p. 70). This bill would have amended North Dakota Century Code Chapter 29.31.1. The amendment, Chapter 29.31.2, required a conviction before seizing property in most cases. However, the amendment did allow police to immediately seize property when there was “probable cause to believe the delay occasioned by the necessity to obtain process would result in the removal or destruction of the personal property.” Additionally, it allowed the courts to collect the equivalent in forfeitable property if the intended property was purposely hidden to avoid seizure. The bill also allowed for the immediate seizure of property from persons with a known criminal history. 5 In regards to protecting the property rights of the citizens of North Dakota, Chapter 29.31.2 guaranteed defendants or third party claimants the right to challenge the validity of a seizure in a pre-trial hearing. Citizens could request a court hearing for property seized any time prior to 60 days before the relevant trial. Such hearings would be held within 30 days of the motion being filed. Lastly, the amendment forbid the retention of forfeited property by law enforcement, substantially reducing the risk of corruption (Malcolm, 2016; Willliams, 2002). Instead, the bill proposed that proceeds from civil asset forfeiture sales would go into the General Fund. H.B. 1170 passed in the North Dakota House (North Dakota Legislative Assembly, 2017a, p. 767) but failed in the Senate (North Dakota Legislative Assembly, 2017b, p. 1018). No civil asset forfeiture reforms were enacted in the 2017 Legislative Assembly. Conclusion Property rights and economic growth are intrinsically linked (Knack & Keefer, 1995; Leblang, 1996; Svensson, 1998; Weingast, 1995). The state should reinforce such rights whenever possible. The people of North Dakota deserve to be secure in their persons and the protection of their property. Given the lack of available data on this issue, it is difficult to measure the impact, if any, civil asset forfeitures have on the state economy. While there is no evidence to condemn or accuse state and local law enforcement officials
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