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Drug forfeiture graphic

Police keep cash intended for education

By KAREN DILLON The Kansas City Star
Date: 01/02/99 18:21

Police and federal agencies have diverted millions of dollars from Missouri schoolchildren.

Under state law, money seized in drug cases is supposed to go to public school districts, but some police departments have found a simple way to keep the money for their own use.

It works like this:

When police discover a cache of drug money, they turn it over to a federal agency, which is not subject to state laws. The agency keeps a cut and returns the rest of the money to police.

Police say some of that windfall is used to fight the war on drugs. But such transfers to federal agencies hurt taxpayers, who must pay more for schools. And they clearly violate state law.

Krieder
Kreider
"The full intent (of the law) was to give that money to the schools, or most of it. They are not getting it," said state Rep. Jim Kreider, a Nixa Democrat and an early backer of the state law.

"If the public knew this in a large scale, they would not like it."

Federal officials and some local police say that the seizures of money are proper and that they've done nothing wrong.

Other law enforcement officials say they believe the law is not clear about every situation that police confront.

"We are trying to determine who is right and who is wrong," said Capt. James Keathley of the Missouri Highway Patrol, which often turns over money to federal agents.

Still other departments won't talk at all about the way they handle federal forfeitures, which is the legal term for the process of taking money.

For example, Kansas City police said state law did not require them to answer questions from the media.

But a federal appellate judge, in a written opinion filed in 1998, said it was clear that the federal Drug Enforcement Administration and the Missouri Highway Patrol had "successfully conspired" in one case to keep forfeited money.

Loken
Loken
That case led Judge James B. Loken of the 8th U.S. Circuit Court of Appeals in his opinion to question whether federal agencies were "using their extensive forfeiture powers to frustrate the fiscal policy of States such as Missouri."


The law's intent

The state's fiscal policy was designed to keep forfeiture money out of the hands of police to prevent a conflict of interest: When police benefit directly from the money they seize, they might be tempted to conduct illegal searches to seize assets.

In fact, that's exactly what has happened across the country, where most states, including Kansas, generally allow police to keep drug money they seize. Illegal searches and other abuses by police departments have been well-documented in recent years in such places as California, Louisiana and Pennsylvania.

Flotron
Flotron
"I am not so concerned where the money goes as I am concerned where the money doesn't go," said Sen. Francis Flotron, a Chesterfield Republican who helped write Missouri's forfeiture law.

"I don't want to create a situation where police have an incentive to stop people for the benefit of getting stuff for their own departmental use."

If the money goes to schools, it not only removes a temptation from police but also is put to good use, relieving a burden from school taxpayers, lawmakers say.

So they set up a process. Police who seize money must report it to the county prosecutor, who along with a judge must decide whether the money should be forfeited. The forfeited money is sent to schools or, in special cases, transferred to a federal agency.

But police have found a way to defeat lawmakers' wishes.

Their efforts to keep drug money have been no secret -- legislators tried to fight them off with tougher laws in 1993 -- yet the police arrangement with federal agencies has been almost invisible to the public.

That's no accident.

Police and federal agencies go to great lengths not to advertise their arrangement. In fact, all those contacted by The Kansas City Star refused to provide public records.

As a result, it's impossible to track how much money law enforcement has diverted from schools.

But The Star was able to glimpse the windfall for law enforcement by finding several police reports and court cases that show how police and federal agencies work together.

In 14 cases in the Kansas City area in recent years, police and the Highway Patrol seized more than $1.4 million and sent it to federal agencies. In return, the federal agencies sent most of the money back to police and the Highway Patrol, usually keeping about 20 percent of it for processing costs.

In each case, legal experts say, a state judge should have decided where the money would go -- and that's usually to schools.

In one typical instance, Kansas City police stopped two men in 1996 because their car did not have a front license plate. Officers searched the car with a drug-sniffing dog and found a shoe box with $22,765 in the front seat, according to police reports. Neither man was charged with a crime, and although they protested the seizure, they gave up a challenge to it because of legal costs.

Police turned the money over to the DEA, which later returned more than $18,000 to the department.

Those 14 cases indicate a pattern of conduct, one expert said.

"Reasonable inferences could be drawn that this is an attempt to circumvent the state forfeiture laws to benefit the state agency," said Jimmy Gurule, a law professor at Notre Dame University and co-author of a legal text on forfeitures.

A few figures suggest how broad the forfeiture diversion by law enforcement may be.

For example, the Missouri Highway Patrol seized $5.4 million from just four vehicles in the last two years in southwest Missouri, said a patrol official in the Springfield office. In each of those cases the patrol called the DEA and turned over the money, he said.

Of all its forfeiture cases in the last three years, the Missouri Highway Patrol sent more than half to federal agencies, according to patrol reports.

Since the 1993 laws were passed, federal agencies have sent more than $32 million back to Missouri law enforcement agencies, according to the U.S. Department of Justice. Some of that money may have come from legitimate joint investigations, but it's impossible to know how much, because neither federal nor local agencies will release seizure reports.

At least one sheriff's official from the other side of the state spoke frankly about the way his department treats drug money.

"We don't deal in state forfeitures at all, because law enforcement doesn't derive any revenues from that," said Capt. Tom Neer of the St. Charles County Sheriff's Department, which sends almost no money to the county school fund.

"You won't find too many local law enforcement agencies participating in state seizures at all."

It's no wonder then that schools aren't receiving much forfeiture money.

In the last three school years, districts in five area counties received only $277,000 -- and that was all in Jackson and Lafayette counties. Schools got nothing in Platte, Clay and Cass counties, officials said.

"It's pretty shocking,"' said Lance Loewenstein, a Kansas City school board member. "The folks who are supposed to protect us are willing to steal from children in order to build their budgets."

The police rationale

Police offer three basic defenses for not complying with Missouri law, which flatly prohibits them from just giving seized money to a federal agency:

  • It's a joint operation.

    If local and federal agencies are investigating the case together, they say, the federal agency can take the money.

    The crucial question is when federal agents become involved.

    In the 14 Kansas City-area cases found by The Star, police didn't call in federal agents until they had already found the money.

    Take the case of Fontaine Jones, who was murdered in March 1997. With the help of a drug-sniffing dog, Kansas City police at the crime scene found $14,425 hidden in a storage compartment in his truck's engine.

    Police seized the cash and later gave it to the DEA, according to court records. In a settlement with Jones' widow in federal court, the law enforcement agencies kept the money and the truck, which was valued at $16,000.

    McCaskill
    McCaskill
    "The bottom line is, if the federal government is not involved before the seizure, the seizure must come through state court," said Claire McCaskill, Jackson County prosecutor. "If that is not occurring, the law is not being followed."

    Even when police officers are working with a federal agency, they must send any money they find through state courts, the law says.

  • State law is insufficient, police say.

    Officers can seize drug money only if they believe a crime has been committed or if the money is unclaimed. But some cases don't meet either requirement, said David Hansen, attorney for the Highway Patrol.

    Troopers sometimes stop a car for a traffic violation, search it and find a bundle of cash that a patrol dog identifies as drug money. The driver says he doesn't know where the money came from and doesn't want it, but that doesn't give troopers authority to seize it if no crime was committed, Hansen said.

    "I don't think anybody really would say that that situation under (Missouri law) was really contemplated," Hansen said.

    In such cases, the trooper has no options but to give the money to a federal agent or let the driver leave with it, he said.

    But state law absolutely prohibits police from just turning money over to a federal agency, said Sen. Wayne Goode, a St. Louis Democrat who helped craft the 1993 laws.

    "They're supposed to go to the (state) court in all of these cases," Goode said.

    Highway Patrol officials said they were now seeking an opinion from Missouri Attorney General Jay Nixon.

  • Taking money isn't the same as seizing it, police say.

    And because Missouri law covers only money that is seized, police say, they can give money to federal agencies if they hadn't really "seized" it.

    The question of when a seizure is a seizure came up after Dennis Cole was stopped in 1994 by the Highway Patrol for speeding on Interstate 70 near Odessa.

    In a search of the car, a trooper found a concealed compartment. The trooper arrested Cole and called a Highway Patrol drug officer, who arrived at the scene before calling a DEA agent.

    The compartment was opened, and officers found more than $844,000. The DEA agent took possession of the money.

    The DEA returned $591,164 to the Highway Patrol and sent $126,678 to a regional task force, keeping the rest.

    Cole, who was never charged, appealed the forfeiture.

    In a ruling last year, Loken, the judge, called it "pure fallacy" that the DEA was part of the case.

    "By summoning a DEA agent and then pretending DEA made the seizure, the DEA and Missouri Highway Patrol officers successfully conspired to violate the Missouri Constitution,... the Missouri Revised Codes, and a Missouri Supreme Court decision," Loken wrote in his concurring opinion.

    Although DEA officials provided The Star with their forfeiture policies, they refused to answer questions.

    Hill
    Hill
    Stephen L. Hill, U.S. attorney for the Western District of Missouri, protests Loken's opinion.

    "We disagree with (Judge Loken's) observations both on when the seizure took place and that there was some kind of effort to circumvent state law," Hill said.

    A seizure doesn't occur just because police find the money, said Frances Reddis, an assistant U.S. attorney.

    "My analogy is, when does an arrest occur?" Reddis said. "Police officers often stop people, question them and it is not considered an arrest until they can't leave."

    Gurule, the Notre Dame legal expert on forfeitures, strongly disagreed. A seizure occurs when someone is stopped by police, he said.

    "To suggest that the seizure of the vehicle and its contents, the money, occurred sometime later when the DEA arrived at the scene is ludicrous," Gurule said.

    Black's Law Dictionary defines a seizure as occurring "not only when an officer arrests an individual, but whenever he restrains the individual's freedom to walk away."

    Despite Loken's opinion, Cole never got his money back -- he filed his appeal of the forfeiture too late.

    Reform in the works

    Public officials say they will press for reform on almost every front:

  • State law -- Kreider and other legislators say they will push for new measures when the General Assembly's 1999 session begins this week.

    Some lawmakers would prohibit any drug money at all going to federal agencies. Others suggest giving police an incentive to work with the state by letting them keep 50 percent of forfeitures.

  • Penalties -- Sen. Ronnie DePasco, a Kansas City Democrat who was just elected floor majority leader, said it might be necessary to enact penalties for law enforcement agencies that do not follow the law.

    "Since there is no penalty clause, they can do whatever they want to do," said DePasco, who also is a member of the Civil and Criminal Jurisprudence Committee. "We'll probably have to put a penalty clause in there to put some teeth in the law."

  • State probe -- Some want the attorney general to investigate.

    Nixon, however, has declined to comment on the issue. His office confirmed that it had talked to the patrol, which asked for an opinion, but would not elaborate because it regarded the patrol as a client.

  • State audit -- Loewenstein, the Kansas City school board member, called for an accounting by the state auditor's office.

    "Those entities are going to have to give back... whatever they took if they indeed did take it," he said. "This is going to be, I'm sure, not a short affair."

    McCaskill, who takes office as Missouri's new state auditor this month, said she would review forfeitures. She said she was disappointed by the pattern of forfeitures The Star had found.

  • Police guidelines -- Kansas City Police Board Commissioner Joe Mulvihill said police needed to set up guidelines if they were not following state law.

    Mulvihill said police hadn't told him about the forfeiture issue, even after The Star had submitted written questions to the department.

    "Since the Kansas City Police Department is the largest law enforcement agency in the area, we have to be perceived by the public as complying with the law," he said.

  • Federal investigation -- Loken, in his opinion last year, called on Congress and the Department of Justice to investigate whether federal agencies were abusing state forfeiture laws.

    -- To reach Karen Dillon, projects reporter for The Star, call (816) 234-4430 or send an e-mail to kdillon@kcstar.com