Bad Laws, Not “Bad Apples,” Drive Forfeiture Abuse

By Lisa Knepper

This issue of Liberty & Law describes how Philadelphia’s forfeiture machine chews up $6 million of its citizens’ cash, cars and homes each year. Regular readers know that local police in Tewksbury, Mass., teamed up with the feds to try to forfeit and cash in on Russ Caswell’s family-owned motel, and that the IRS seized the bank account of the Dehko family’s grocery store even though they did nothing wrong.

What’s behind the seemingly constant stream of forfeiture abuse? A groundbreaking new IJ report answers that question.

IJ and other critics of civil forfeiture have long argued that allowing law enforcement to take property and pocket the proceeds creates incentives to put profits ahead of justice. Proponents counter that any abuse results from isolated bad actors and that civil forfeiture enables law enforcement to turn criminal profits into additional crime-fighting resources, improving public welfare.

We asked Bart Wilson, an economics professor at Chapman University, to put these competing claims to the test. Wilson’s expertise is experimental economics, a research method that uses lab experiments to examine how people interact with each other under different sets of rules. The Nobel Prize committee recognized the value of the method when it honored Vernon Smith, one of its pioneers and a colleague of Wilson.

Wilson and co-author Michael Preciado designed a cutting-edge experiment to see whether the rules of civil forfeiture change people’s behavior, and if so, how. IJ’s newest strategic research report, Bad Apples or Bad Laws? Testing the Incentives of Civil Forfeiture, details their experiment and its results.

Wilson and Preciado tasked participants with making the same kinds of choices law enforcement officers make with and without the ability to take and keep property. They wanted to know: If people can take property from others, will they? And will they keep it for themselves, as civil forfeiture critics argue, or use it to improve public welfare, as proponents claim?

The results show that civil forfeiture does change behavior, and not in a good way. People in the experiment generally used their limited resources to improve public welfare—until civil forfeiture gave them the opportunity to take and keep property. Given the chance, people overwhelmingly chose to take others’ property, and even with this boost in resources, public welfare suffered.

As Wilson and Preciado concluded, “When civil forfeiture puts people in a position to choose between benefiting themselves or the overall public, people choose themselves.”

In short, incentives matter. And civil forfeiture laws create real incentives for law enforcement agencies to seize property not to improve public safety, but to pad their own budgets. The results suggest that forfeiture abuse isn’t the result of a few “bad apples,” but bad laws that encourage bad behavior—it’s not the players so much as the game.

The experiment’s findings have important implications for legislators considering forfeiture reform and courts confronting legal challenges to the government’s forfeiture power. Replacing officers guilty of abuse or tweaking the process will only treat the symptoms, not the disease—the profit incentive that drives the civil forfeiture racket. The only way to stop government seizures of innocent people’s property is to end civil forfeiture and take the profit out of policing.

Lisa Knepper is an IJ director of strategic research.