State and Federal Governments Must Improve Forfeiture Transparency

Arlington, Va.—The federal government’s forfeiture transparency laws, as well as those of most states, are in dire need of reform, as they too often leave Congress, state legislators and the public in the dark about how forfeiture is being used—and unable to hold law enforcement accountable. So finds a new report released today by the Institute for Justice.

IJ’s report, Forfeiture Transparency & Accountability: State-by-State and Federal Report Cards, grades the U.S. departments of Justice and the Treasury, as well as all 50 states and the District of Columbia, on six basic elements of transparency and accountability in their forfeiture programs.

“Given the vast power forfeiture confers on law enforcement to take and keep property—often without criminal charge or conviction—law enforcement should be held to the highest standards of transparency and accountability,” said Angela C. Erickson, senior research analyst at IJ and co-author of the study. “Unfortunately, most states fail at one or more basic elements of forfeiture transparency and both the DOJ and Treasury receive decidedly mixed report cards, showing real need for improvement.”

Here’s how the DOJ and Treasury perform on the report card:

Department of Justice
Tracking Seized Property A-
Accounting for Forfeiture Fund Spending C
Aggregate Forfeiture Reports A
Accessibility of Forfeiture Records A
Penalties for Failure to File a Report F
Financial Audits of Forfeiture Accounts A
Department of the Treasury
Tracking Seized Property F
Accounting for Forfeiture Fund Spending C
Aggregate Forfeiture Reports B
Accessibility of Forfeiture Records A
Penalties for Failure to File a Report F
Financial Audits of Forfeiture Accounts A

For state-by-state report cards, visit http://ij.org/report/forfeiture-transparency-accountability.

Unlike the federal government, many states offer little or no transparency or accountability. But while the federal government performs better than many states, it still falls short in important ways.

Both the DOJ and Treasury produce reports that give Congress and the public a bird’s eye view of the departments’ forfeiture activity, earning them high marks for aggregate reporting. These reports are annual financial statements of the departments’ forfeiture funds, which hold the proceeds from property they forfeit, and they show how much money is flowing into and out of the funds each year. The DOJ also provides additional information, including how its agencies spend money from its forfeiture fund, earning it an A for aggregate reporting. Lacking such agency-level detail, the Treasury earns a B for its aggregate report. Both departments earn an A for making these reports easily accessible to the public by posting them online.

However, both departments’ public reports lack the kind of detail needed to fully understand how their forfeiture programs are working on the ground. That kind of detail comes from individually tracking properties seized as they move through the forfeiture system, identifying the average amount of cash seized or how often a claim is filed for the return of seized property, for example. The DOJ tracks much of that information using a database called the Consolidated Asset Tracking System, or CATS, earning it an A- for tracking seized properties. DOJ makes CATS available through Freedom of Information Act requests, but putting it online would substantially boost transparency.

A separate database tracks Treasury forfeitures, but the government refuses to release it. (IJ has sued under FOIA to secure a copy.) Without access to the database, it is impossible to know how well Treasury tracks its forfeiture activity, earning it an F.

Both DOJ and the Treasury should also provide a fuller accounting of how their forfeiture monies are spent, especially on personnel costs like salaries, and they should do so for every agency that draws on forfeiture funds. The departments earn a C for providing limited spending information. Meanwhile, the overwhelming majority of states—34—provide zero information about how their law enforcement agencies are spending the proceeds of forfeiture.

“With forfeiture, law enforcement agencies can keep some or all of the proceeds from the property they take. This enables them to generate and spend funds outside the normal appropriations process, which undermines legislatures’ power of the purse,” said Jennifer McDonald, an IJ research analyst and co-author of the report. “At a minimum, law enforcement should have to provide a detailed account of how forfeiture proceeds are being spent.”

At the federal level, the DUE PROCESS Act, introduced last year, would have improved forfeiture transparency by creating two publicly available forfeiture databases, one on the details of forfeitures and the other to assist owners of seized property. Even more importantly, the legislation would also have reformed federal forfeiture laws to better protect property rights. Unfortunately, Congress failed to pass the Act. For states, IJ has model reporting legislation that provides a blueprint for reform.

“By itself, improved transparency cannot fix the fundamental problemswith civil forfeiture—namely, the property rights abuses it permits and the temptation it creates to police for profit,” said Darpana Sheth, senior attorney and director of IJ’s nationwide initiative to end forfeiture abuse. “Transparency is no substitute for comprehensive forfeiture reform, but it is still vitally important for bringing forfeiture activity and spending into the light of day.”