Asset Forfeiture, State

Each state and territory in the United States has its own forfeiture statute. Hundreds of statutes exist that are linked to a variety of state crimes, including drug offenses. Generally, state statutes apply language and procedures modeled after the provisions of federal forfeiture laws. As with federal forfeiture, state statutes define the conduct giving rise to forfeiture and a state officer's authority to seize property. Similarly, many state statutes provide for judicial, administrative, and summary forfeiture.

Most states provide for judicial in rem or in personam proceedings, which are applied to civil and criminal forfeitures, respectively. Civil forfeitures proceed as in rem actions. In rem is a legal proceeding against an asset in which the state forfeits all right, title, and interest in that asset. Criminal forfeitures are in personam proceedings against the asset's owner for the purpose of obligating that owner to forfeit the owner's interest in the property to the government.

Administrative forfeiture applies to specified property valued below a statutory threshold. Administrative forfeitures are also in rem actions that provide authority to a seizing agency to forfeit a property without judicial involvement. In administrative forfeitures, the state needs only to provide notice of the seizure to potential innocent claimants. If no one files a claim within a specified time, the property is forfeited, through default, without invoking a judicial proceeding against the property. On the other hand, if a claimant files a claim to the property, the case proceeds judicially and a judge determines whether the asset will be forfeited.

Forfeiture at both the state and federal levels occurs under two theoretical precepts. The first, facilitation theory, allows for the forfeiture of property involved in the manufacture, delivery, and sale of controlled substances. It can include automobiles, boats, or airplanes used to transport drugs, as well as real estate used to store drugs or as the location where drugs are trafficked. Under proceeds theory, property that represents the profit of certain unlawful activities can be seized by the government. This theory is most applicable for money laundering and other financial crimes, such as racketeering and fraud. Property that is subject to forfeiture under this legal theory includes bank accounts, financial instruments (e.g., stocks), real estate, jewelry, cash, electronic equipment, vehicles, and so on.

Some assets are illegal altogether. Examples include Schedule I and Schedule II drugs. In such cases, the state may seize the property under summary forfeiture proceedings. The state need not provide notice of the seizure to potential claimants because no legal possessory interest exists for the property.

Many small law enforcement agencies do not have forfeiture programs because of a lack of startup funds and other resources (e.g., storage facilities, appraisers, real property managers, financial investigation expertise). Other jurisdictions maintain minimal forfeiture activity. For such jurisdictions, federal agencies can provide the catalyst for asset forfeiture proceedings.

In 1982, to encourage states that had not yet passed laws regarding forfeiting the profits of drug trafficking, the Drug Enforcement Administration developed a Model Forfeiture of Drug Profits Act that suggested that states allocate revenue generated through seizure and forfeiture to drug enforcement.[Page 17] However, even though all states were seizing illicit substances during routine narcotics operations, few were following the federal example of seizing drug profits. For these state and local agencies, Congress provided an equitable sharing provision in the Comprehensive Crime Control Act of 1984. This provision allowed federal agencies to divide the proceeds derived from civil forfeitures with all participating law enforcement agencies. The provision was further designed to encourage future cooperation between state and local agencies and the federal agencies that processed the forfeitures. Equitable sharing results when the federal agency agrees to process a seizure under federal forfeiture laws and remits proceeds back to the participating state or local agency.

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