Asset Forfeiture and the Cycle of Electronic Surveillance Funding

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EFF.orgEFF Note: The bulk of the research in this post was com­piled pri­or to Attor­ney Gen­er­al Eric Holder’s sur­prise announce­ment that he is cur­tail­ing the fed­er­al equi­table shar­ing pro­gram. The post may be updat­ed as fur­ther ram­i­fi­ca­tions of the pol­i­cy deci­sion become clear.

“You fol­low drugs, you get drug addicts and drug deal­ers. But you start to fol­low the mon­ey, and you don’t know where the f*** it’s gonna take you.”

This oft-cit­ed wis­dom comes from Detec­tive Lester Frea­mon, a char­ac­ter in the clas­sic HBO series The Wire, which tracked how an elite task force of (fic­tion­al) Bal­ti­more cops used elec­tron­ic sur­veil­lance to bring down crim­i­nal net­works. But, the sen­ti­ment is iron­ic to a fault: if you keep fol­low­ing the mon­ey, it might take you right back to the police.

Asset for­fei­ture has long been a top­ic of con­tro­ver­sy in law enforce­ment. Cops and pros­e­cu­tors have had the pow­er to seize prop­er­ty and cash from sus­pects before any­one has actu­al­ly been con­vict­ed of a crime (usu­al­ly nar­cotics-relat­ed). Then these law enforce­ment agen­cies have plugged a por­tion of that mon­ey (and mon­ey derived from auc­tion­ing of prop­er­ty) into their own bud­gets, allow­ing them to spend in ways that pos­si­bly would not have passed scruti­ny dur­ing the for­mal appro­pri­a­tions process.

Crit­ics note that asset for­fei­ture cre­ates a per­verse incen­tive for polic­ing pri­or­i­ties: the more assets cops seize, the more mon­ey they get to spend. Satirist John Oliv­er char­ac­ter­ized the prac­tice as akin to “legal­ized rob­bery by law enforce­ment” in a must-watch seg­ment on his show Last Week Tonight. News orga­ni­za­tions, includ­ing New York Times, the New York­er and the Wash­ing­ton Free Bea­con have recent­ly out­lined abus­es of the sys­tem.

The good news is that, on Fri­day, the Wash­ing­ton Post report­ed that Attor­ney Gen­er­al Eric Hold­er is tak­ing steps to rein in the fed­er­al ver­sion of the pro­gram, bar­ring state and local law enforce­ment agen­cies from “using fed­er­al law to seize cash, cars and oth­er prop­er­ty with­out evi­dence that a crime occurred.”

Last year, the Wash­ing­ton Post’s inves­tiga­tive team used the Free­dom of Infor­ma­tion Act to lib­er­ate hun­dreds of thou­sands of doc­u­ments asso­ci­at­ed with fed­er­al asset for­fei­ture, includ­ing the entire col­lec­tion of annu­al spend­ing dis­clo­sures (“Equi­table Shar­ing Agree­ments”) filed with the U.S. Depart­ment of Jus­tice by each indi­vid­ual law enforce­ment agency and task force across the coun­try that receives these funds. The doc­u­ments reveal a wide vari­ety of spend­ing, from using seized assets to pay for new vehi­cles and heli­copters, drug “buy” mon­ey, pay­ments to con­fi­den­tial infor­mants, trav­el expens­es, law enforce­ment equip­ment, and rewards for police, such as “chal­lenge coins.

An exam­i­na­tion of these doc­u­ments reveal the con­nec­tion between seized assets and elec­tron­ic sur­veil­lance across the coun­try.  It many ways, it has been a cir­cu­lar, self-sus­tain­ing sys­tem: asset for­fei­ture helps law enforce­ment agen­cies pay for elec­tron­ic sur­veil­lance, which allows cops to seize more mon­ey to pay for elec­tron­ic sur­veil­lance.nationwide_totals_2008-2013
Accord­ing to data com­piled by the Wash­ing­ton Post for the years 2008–2013, law enforce­ment agen­cies around the coun­try col­lec­tive­ly spent $121 mil­lion of fed­er­al asset for­fei­ture funds on elec­tron­ic sur­veil­lance equip­ment, an annu­al nation­wide aver­age  $20.2 mil­lion.

The forms do not clear­ly define “elec­tron­ic sur­veil­lance,” but it typ­i­cal­ly includes the type of equip­ment used in wire­taps. The amount of seized assets spent on elec­tron­ic sur­veil­lance could poten­tial­ly be much high­er, since law enforce­ment agen­cies can cat­e­go­rize staff time spent on sur­veil­lance in oth­er cat­e­gories. Some­times agen­cies weren’t sure how to cat­e­go­rize cer­tain tech­nolo­gies, such as auto­mat­ic license plate read­ers and GPS track­ing devices, so they report­ed them sep­a­rate­ly under oth­er cat­e­gories. To put it anoth­er way: these num­bers are just the chunk of the ice­berg view­able through pub­lic records.

The data sets are enor­mous, so let’s drill down on Cal­i­for­nia. Brace your­self, it’s about to get mathy.

How Wire­taps Are Used to Seize Funds

Cal­i­for­nia law enforce­ment agen­cies exe­cut­ed 2,078 wire­tap orders between 2011 and 2013, accord­ing to the Cal­i­for­nia Elec­tron­ic Inter­cep­tions Reports, an annu­al account­ing of elec­tron­ic sur­veil­lance com­piled by the Cal­i­for­nia Attor­ney General’s Office.  These reports show that these agen­cies seize hun­dreds of mil­lions of dol­lars each year in wire­tap-relat­ed crim­i­nal inves­ti­ga­tions, usu­al­ly involv­ing nar­cotics or gang activ­i­ties, and fre­quent­ly in part­ner­ship with fed­er­al agen­cies.

In Los Ange­les Coun­ty, law enforce­ment agen­cies con­duct­ed 515 wire­tap oper­a­tions over that three-year peri­od, lead­ing to the seizure of at least $25 mil­lion in assets. The Cal­i­for­nia Elec­tron­ic Inter­cep­tions Report pro­vides details on the out­come of every sin­gle wire­tap, which typ­i­cal­ly include the num­ber of com­mu­ni­ca­tions cap­tured, the num­ber of indi­vid­u­als affect­ed by the wire­tap, and any arrests made or drugs or assets seized. For exam­ple, you might see that one 2013 LA wire­tap inter­cept­ed 9,273 com­mu­ni­ca­tions involv­ing 67 peo­ple, result­ing in a sin­gle arrest and the seizure of $427,000 in alleged nar­cotics pro­ceeds. Or that in 2012, LA author­i­ties cap­tured 6,176 com­mu­ni­ca­tions involv­ing 245 peo­ple, result­ing in the seizure of $440,000 in alleged drug mon­ey.

The Cost of Wire­taps

Elec­tron­ic sur­veil­lance isn’t cheap. Between 2011 and 2013, the aver­age cost to exe­cute a wire­tap order in Cal­i­for­nia was $40,594, which includ­ed $36,807 for staff time and $3,787 for equip­ment-relat­ed expens­es.

From a bird’s eye view, Cal­i­for­nia law enforce­ment agen­cies col­lec­tive­ly spent $84 mil­lion on elec­tron­ic inter­cep­tions dur­ing that peri­od, an aver­age of $28 mil­lion per year. Of that, staff time spent on elec­tron­ic sur­veil­lance cost Cal­i­for­nia agen­cies $76 mil­lion ($25 mil­lion annu­al­ly) and equip­ment-relat­ed expens­es cost $7.9 mil­lion  ($2.6 mil­lion annu­al­ly).

In Los Ange­les Coun­ty alone, law enforce­ment agen­cies spent $20.3 mil­lion between 2011 and 2013, includ­ing $2.1 mil­lion on wire­tap equip­ment.

How Seized Assets Were Turned into Elec­tron­ic Sur­veil­lance

top_15_californiaWhen local law enforce­ment agen­cies par­tic­i­pat­ed in fed­er­al inves­ti­ga­tions, the fed­er­al gov­ern­ment paid them back by divvy­ing out a por­tion of the pro­ceeds from the seizures.  These agen­cies includ­ed police depart­ment, sher­iff offices, and dis­trict attor­ney offices, as well as inves­tiga­tive task forces that span mul­ti­ple juris­dic­tions. These agen­cies were required to broad­ly report how they spent the mon­ey in a vari­ety of cat­e­gories, includ­ing elec­tron­ic sur­veil­lance, on an annu­al basis.

Between 2011 and 2013, law enforce­ment agen­cies in Cal­i­for­nia spent a total of $13.6 mil­lion in funds from the fed­er­al asset for­fei­ture pro­gram on elec­tron­ic sur­veil­lance equip­ment, a statewide aver­age of $4.5 mil­lion per year.

To give a sense of scale: that was enough to cov­er the cost of wire­tap equip­ment (includ­ing instal­la­tion fees, sup­plies, and equip­ment) for the entire state of Cal­i­for­nia, with change left over.

To look at it anoth­er way, that’s enough to pay for equip­ment in more than 3,500 wire­taps, far more than these agen­cies actu­al­ly con­duct­ed. This could indi­cate that either agen­cies may have bought more equip­ment than they need­ed to car­ry out these wire­taps, used the funds to pay staff, or that they may have spent sig­nif­i­cant por­tions of the mon­ey on sur­veil­lance that doesn’t require a wire­tap order.

Los Ange­les Coun­ty is made up of dozens of local law enforce­ment agen­cies and task forces, but two in par­tic­u­lar con­sis­tent­ly rose to the top of elec­tron­ic sur­veil­lance spend­ing: the Los Ange­les Coun­ty Sheriff’s Office and Los Ange­les Inter­a­gency Met­ro­pol­i­tan Police Appre­hen­sion Crime Team (LA IMPACT), a cross-juris­dic­tion­al task force.

The Los Ange­les Coun­ty Sheriff’s Depart­ment dug deep into seized fed­er­al asset for­fei­ture funds to run its elec­tron­ic sur­veil­lance oper­a­tions. Between 2008 and 2014, the LA Sher­iff received a total of $47.3 mil­lion from the fed­er­al pro­gram and spent rough­ly $4 mil­lion of that on elec­tron­ic sur­veil­lance equip­ment. Mean­while, LA IMPACT received approx­i­mate­ly $30 mil­lion in asset for­fei­ture funds over that peri­od, two thirds of which it trans­ferred to oth­er law enforce­ment agen­cies. Of the remain­ing mon­ey, about $620,000 went towards elec­tron­ic sur­veil­lance.

That’s how it works (or worked on the fed­er­al lev­el before Holder’s announce­ment): police spend mon­ey on elec­tron­ic sur­veil­lance, which leads to the seizure funds from sus­pect­ed crim­i­nals, and then that mon­ey is chan­neled back to police to use on more elec­tron­ic sur­veil­lance.

Holder’s announce­ment could have a sig­nif­i­cant impact on how law enforce­ment agen­cies fund elec­tron­ic sur­veil­lance. How­ev­er, it’s impor­tant to remem­ber that the next administration’s attor­ney gen­er­al could eas­i­ly reverse this pol­i­cy deci­sion. Fur­ther, many states also have their own asset for­fei­ture pro­grams, so a whole sec­ond lay­er of fund­ing remains on the state lev­el.

The Wash­ing­ton Post has released its giant cache of Equi­table Shar­ing Agree­ments from thou­sands of local law enforce­ment agen­cies around the coun­try. We urge you to dig in, find your local cops, iden­ti­fy out how they’ve spend this mon­ey, and let the world know what you find.

Major thanks goes out to Wash­ing­ton Post data edi­tor Steven Rich and his col­leagues for free­ing this data, mak­ing it avail­able to the pub­lic, and help­ing us wrap our heads around the spread­sheets.