Law enforcement seizing your money in the absence of any wrongdoing will always be infuriating. But when the money seized was meant to fund a once-in-a-lifetime party for your daughter, the sensation must be especially wrenching.
Miladis Salgado, 54, lives in Miami-Dade County, Florida. Salgado works two jobs and saved for years to fund a quinceanera party for her daughter’s 15th birthday. But in 2015, federal agents raided her home on a bogus tip from a narcotics informant. Despite finding no evidence of drug dealing, the agents seized cash and cashier’s checks on hand – including Salgado’s $15,000 life savings, part of which she had set aside for the party. Salgado and her daughter had to cancel the event. In a later deposition, the lead Drug Enforcement Administration agent for the case admitted that the government lacked any evidence that connected Salgado, her family members or the seized assets to criminal activity. Even so, it took almost two years for Salgado to recover the money, and she incurred about $5,000 in attorney’s fees in the process.
As I have written in this space previously, civil asset forfeiture is an invitation to abuse. Law enforcement officers in these programs are empowered to seize the assets or property of people who have not been convicted of, or in some cases even charged with, a crime. Often that seized property goes directly to fund the enforcement agency’s budget. This creates a clear incentive to take the cash first and ask questions later.
Now Salgado and her attorney have asked the Supreme Court to hear her case. Not only was Salgado’s money seized unjustly, but because the government voluntarily cut her a check for the original amount, government attorneys avoided the federal requirement to pay Salgado’s attorney’s fees. Had a judge ordered them to pay Salgado, they would have had to make her financially whole, fees included.
The asset seizure system rests on the theory that if no crime exists, owners get their money or their stuff back: No harm, no foul. Except, in Salgado’s case and many others, the harm was very real. Salgado faced two years of legal struggle to recover her property, not to mention losing a third of her savings to attorney’s fees. And Salgado’s daughter was left with a beautiful quinceanera dress and nowhere to wear it. Law enforcement officers should note that teenagers only turn 15 once.
It has been obvious for decades that asset forfeitures are doing vast harm to people who are innocent as a matter of fact, not to mention those who are innocent as a matter of law because they don’t get prosecuted, let alone convicted. Many give up on getting their property back due to exhaustion, lack of means to pay attorneys or both. Others settle for a fraction of their original assets after months or years of fighting the agency that took them. According to figures from the Institute for Justice, 88% of federal forfeiture cases never make it to a judge.
The forfeiture targets who sue face big legal bills or contingent payments that can take up to half the seized property’s value. The government should cover those legal fees, costs and interest when the citizen “substantially prevails,” as outlined in the Civil Asset Forfeiture Reform Act, which Congress passed in 2000. But, as in Salgado’s case, the government can wiggle out of that liability. Government attorneys need only give the money back and ask the court to dismiss the case “without prejudice,” meaning it can technically be refiled. Of course, the government won’t refile it, because the government can’t win. But because the opening is there, the courts have said the citizen has not “substantially” prevailed. Thus the government need not pay the attorneys’ fees. In other words, the courts’ position is that if the government wrongfully takes your money and then gives it back after you go to court, you didn’t win the conflict.
The Supreme Court has a chance to correct this travesty, and that’s literally the least it can – and should – do. Yet stopping this chicanery is not enough. The Supreme Court should ultimately answer the question as to whether civil asset forfeiture, as it is actually practiced and authorized, respects citizens’ right to due process. The answer should be easy: It doesn’t.
Last year, the Supreme Court ruled that the Eighth Amendment prohibits excessive fines, whether issued by federal, state or municipal authorities. As that case made clear, civil asset forfeiture is a penalty, and one that can become excessive if unchecked. In civil suits to reclaim their property, citizens carry the burden of proof, not the government that took the property in the first place. Governments at all levels have created financial incentives for law enforcement to aggressively seize property without cause, and individual law enforcement officers are nearly always immune from personal liability for the excesses they commit under this scheme. The high court should put a stop to it.
But this is a conservative court, and not just in the political sense of the word. Today’s Supreme Court seldom reaches far beyond the issues presented in a case. In Salgado v. United States, a mom is just trying to get her attorney’s fees reimbursed so she can be made whole, at least financially. (Absent the invention of time travel, her daughter’s party is lost forever.) If it takes the case at all, the Supreme Court will most likely confine itself to the issue at hand, which is the definition of “substantially” prevailing against the government in a case like Salgado’s.
I would like to think – or at least hope – that the justices won’t just toss out this rancid fruit. I hope that they chop down the deformed legal tree on which it grew. But such sweeping moves are unusual from today’s court. Maybe I’ll be pleasantly surprised. More likely, Congress or a future litigant someday will have to challenge this rotten system, and the value-impaired law enforcement community that protects it, head-on.
Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book,
The High Achiever’s Guide To Wealth. His contributions include Chapter 1, “Anyone Can Achieve Wealth,” and Chapter 19, “Assisting Aging Parents.” Larry was also among the authors of the firm’s previous book
Looking Ahead: Life, Family, Wealth and Business After 55.
Posted by Larry M. Elkin, CPA, CFP®
photo by Robert Lyle Bolton
Law enforcement seizing your money in the absence of any wrongdoing will always be infuriating. But when the money seized was meant to fund a once-in-a-lifetime party for your daughter, the sensation must be especially wrenching.
Miladis Salgado, 54, lives in Miami-Dade County, Florida. Salgado works two jobs and saved for years to fund a quinceanera party for her daughter’s 15th birthday. But in 2015, federal agents raided her home on a bogus tip from a narcotics informant. Despite finding no evidence of drug dealing, the agents seized cash and cashier’s checks on hand – including Salgado’s $15,000 life savings, part of which she had set aside for the party. Salgado and her daughter had to cancel the event. In a later deposition, the lead Drug Enforcement Administration agent for the case admitted that the government lacked any evidence that connected Salgado, her family members or the seized assets to criminal activity. Even so, it took almost two years for Salgado to recover the money, and she incurred about $5,000 in attorney’s fees in the process.
As I have written in this space previously, civil asset forfeiture is an invitation to abuse. Law enforcement officers in these programs are empowered to seize the assets or property of people who have not been convicted of, or in some cases even charged with, a crime. Often that seized property goes directly to fund the enforcement agency’s budget. This creates a clear incentive to take the cash first and ask questions later.
Now Salgado and her attorney have asked the Supreme Court to hear her case. Not only was Salgado’s money seized unjustly, but because the government voluntarily cut her a check for the original amount, government attorneys avoided the federal requirement to pay Salgado’s attorney’s fees. Had a judge ordered them to pay Salgado, they would have had to make her financially whole, fees included.
The asset seizure system rests on the theory that if no crime exists, owners get their money or their stuff back: No harm, no foul. Except, in Salgado’s case and many others, the harm was very real. Salgado faced two years of legal struggle to recover her property, not to mention losing a third of her savings to attorney’s fees. And Salgado’s daughter was left with a beautiful quinceanera dress and nowhere to wear it. Law enforcement officers should note that teenagers only turn 15 once.
It has been obvious for decades that asset forfeitures are doing vast harm to people who are innocent as a matter of fact, not to mention those who are innocent as a matter of law because they don’t get prosecuted, let alone convicted. Many give up on getting their property back due to exhaustion, lack of means to pay attorneys or both. Others settle for a fraction of their original assets after months or years of fighting the agency that took them. According to figures from the Institute for Justice, 88% of federal forfeiture cases never make it to a judge.
The forfeiture targets who sue face big legal bills or contingent payments that can take up to half the seized property’s value. The government should cover those legal fees, costs and interest when the citizen “substantially prevails,” as outlined in the Civil Asset Forfeiture Reform Act, which Congress passed in 2000. But, as in Salgado’s case, the government can wiggle out of that liability. Government attorneys need only give the money back and ask the court to dismiss the case “without prejudice,” meaning it can technically be refiled. Of course, the government won’t refile it, because the government can’t win. But because the opening is there, the courts have said the citizen has not “substantially” prevailed. Thus the government need not pay the attorneys’ fees. In other words, the courts’ position is that if the government wrongfully takes your money and then gives it back after you go to court, you didn’t win the conflict.
The Supreme Court has a chance to correct this travesty, and that’s literally the least it can – and should – do. Yet stopping this chicanery is not enough. The Supreme Court should ultimately answer the question as to whether civil asset forfeiture, as it is actually practiced and authorized, respects citizens’ right to due process. The answer should be easy: It doesn’t.
Last year, the Supreme Court ruled that the Eighth Amendment prohibits excessive fines, whether issued by federal, state or municipal authorities. As that case made clear, civil asset forfeiture is a penalty, and one that can become excessive if unchecked. In civil suits to reclaim their property, citizens carry the burden of proof, not the government that took the property in the first place. Governments at all levels have created financial incentives for law enforcement to aggressively seize property without cause, and individual law enforcement officers are nearly always immune from personal liability for the excesses they commit under this scheme. The high court should put a stop to it.
But this is a conservative court, and not just in the political sense of the word. Today’s Supreme Court seldom reaches far beyond the issues presented in a case. In Salgado v. United States, a mom is just trying to get her attorney’s fees reimbursed so she can be made whole, at least financially. (Absent the invention of time travel, her daughter’s party is lost forever.) If it takes the case at all, the Supreme Court will most likely confine itself to the issue at hand, which is the definition of “substantially” prevailing against the government in a case like Salgado’s.
I would like to think – or at least hope – that the justices won’t just toss out this rancid fruit. I hope that they chop down the deformed legal tree on which it grew. But such sweeping moves are unusual from today’s court. Maybe I’ll be pleasantly surprised. More likely, Congress or a future litigant someday will have to challenge this rotten system, and the value-impaired law enforcement community that protects it, head-on.
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