Kansas and California Cops Used Civil Forfeiture to Stage Armored Car Heists, Stealing Money Earned by Licensed Marijuana Businesses
The Institute for Justice argues that the seizures violated state law, federal law, and the U.S. Constitution.
Because the continued federal prohibition of marijuana makes banks and payment processors leery of serving state-licensed cannabis suppliers, many of those businesses rely heavily on cash, which exposes them to a heightened risk of robbery. As a new federal lawsuit shows, that danger is not limited to garden-variety criminals. It includes cops who use federal civil forfeiture laws to steal money earned by state-legal marijuana businesses.
Five times since last May, sheriff's deputies in Kansas and California have stopped armored cars operated by Empyreal Logistics, a Pennsylvania-based company that serves marijuana businesses and financial institutions that work with them. The cops made off with cash after three of those stops, seizing a total of $1.2 million, but did not issue any citations or file any criminal charges, which are not necessary to confiscate property through civil forfeiture. That process allows police to pad their budgets by seizing assets they allege are connected to criminal activity, even when the owner is never charged, let alone convicted.
Empyreal, which is represented by the Institute for Justice, argues that the seizure of its clients' money violated state law, federal law, and the U.S. Constitution. In a complaint it filed last Friday in the U.S. District Court for the Central District of California, Empyreal says it is "entitled to protection from highway robberies, regardless of whether they are conducted by criminals or by the Sheriff and federal law-enforcement agencies acting under color of law."
On May 17, Dickinson County Sheriff's Deputy Kalen Robinson pulled over one of Empyreal's vans on Interstate 70 in Kansas, ostensibly because the Colorado tag number was partially obstructed by the license plate frame. Robinson grilled the driver, who explained that she planned to pick up cash from licensed medical marijuana dispensaries in Kansas City, Missouri, the next day, then take it to a credit union in Colorado, which would entail traveling through Kansas again on the same highway. Robinson let the driver proceed on her way without issuing a citation, but the federal Drug Enforcement Administration (DEA) kept an eye on the van the following morning as it visited the Missouri dispensaries.
Later that day, Robinson stopped the van again as it traveled west on Interstate 70, seizing more than $165,000 in cash from its vault. In September, the Justice Department filed a civil forfeiture complaint seeking to keep the money. If the government prevails, the Dickinson County Sheriff's Department will get up to 80 percent of the loot under the Justice Department's "equitable sharing" program.
In the affidavit supporting the federal forfeiture complaint, DEA Special Agent Bryson Wheeler noted that "marijuana is a controlled substance and illegal under both federal and Kansas state law." But Empyreal argues that the DEA's participation in this scheme ran afoul of the Rohrabacher-Blumenauer Amendment, a spending rider that bars the Justice Department (which includes the DEA and the FBI) from using any of its funds to interfere with the implementation of state laws authorizing the medical use of marijuana. Because the DEA violated that restriction, the company says, it also violated the Fourth Amendment's ban on unreasonable searches and seizures. And because the seizure was motivated by the prospect of financial gain, the lawsuit says, it violated the Fifth Amendment's guarantee of due process.
The stops and seizures in California raise additional legal issues, because that state, unlike Kansas, allows the sale of marijuana for medical or recreational use. It also explicitly protects companies like Empyreal from harassment by local or state law enforcement agencies. A 2020 law says a business that "transports cash or financial instruments, or provides other financial services does not commit a crime under any California law…solely by virtue of the fact that the person receiving the benefit of any of those services engages in commercial cannabis activity as a licensee pursuant to this division." Despite that law, San Bernardino County sheriff's deputies stopped Empyreal vans three times in November, December, and January, seizing more than $1 million.
On November 16, Sheriff's Deputy Jonathan Franco pulled over one of the company's vehicles, supposedly because it was following a tractor-trailer truck too closely. Like Robinson, Franco did not issue any citations. But after the driver told him the van was carrying cash, the lawsuit says, Franco "asked many questions about the nature of Empyreal's business." Even though it should have been clear that Empyreal was not violating any state laws, the cops seized about $700,000. The sheriff's office later told the company's lawyer the money "was transferred to the FBI for civil forfeiture."
On December 9, Empyreal says, the same deputies pulled over the same vehicle, driven by the same employee, ostensibly because he "slightly exceeded the speed limit and prematurely activated his turn signal." But once again, no citation was issued. According to the lawsuit, "the driver's operation of the Empyreal vehicle was completely lawful." The company says "the deputies had planned the stop in advance and would have pulled over the driver and the Empyreal vehicle regardless of how carefully or lawfully it was driven."
The deputies claimed a drug-sniffing dog alerted to the van, which Empyreal says also is not true: "Video footage from the vehicle does not show the dog alert on the vehicle. Instead, it shows the dog is barely interested in the vehicle."
This time the cops seized about $350,000. The deputies, who were audibly excited about the $700,000 haul, were somewhat disappointed by the relatively small size of the second seizure. Based on an audio recording by the van's security system, the lawsuit describes this exchange: "One of the deputies said, 'That's it?' and chuckled. He then said: 'You set the bar too high.' When another deputy remarked that he thought they'd get 'a million or two,' the [first] deputy responded, 'At least we got over a million'"—apparently referring to the combined take from the two seizures. The FBI later told Empyreal's lawyer it had also taken possession of the money seized on December 9, pending federal forfeiture proceedings.
From San Bernardino County Sheriff Shannon Dicus' perspective, involving the feds has clear advantages. Money earned by state-legal marijuana businesses is not subject to forfeiture under California law. Even if it were, law enforcement agencies would be entitled to just 65 percent of the proceeds, compared to as much as 80 percent under federal law. And for cash forfeitures involving $40,000 or more, California requires "clear and convincing evidence," while federal law says "a preponderance of the evidence" is good enough.
Recognizing the allure of those terms, California legislators have prohibited federal "adoption" of seizures initiated by state or local law enforcement agencies. But that restriction does not cover seizures by anti-drug task forces that include federal as well as local agencies. Empyreal suspects the California stops involved such a task force: the Inland Regional Narcotics Enforcement Team.
Federal participation still implicates the Rohrabacher-Blumenauer Amendment. Empyreal says three of the four businesses whose money it was transporting on November 16 had medical marijuana licenses, while all of the money seized on December 9 came from businesses with such licenses. The company also argues that Dicus, one of the defendants named in the lawsuit, exceeded his own authority by allowing or instructing his deputies to stop, search, and rob the company's vans without any evidence of state crimes.
The third California stop sheds some light on that strategy. On January 6, the lawsuit says, San Bernardino County sheriff's deputies stopped an Empyreal driver who was "picking up an order of rolled coin boxes from Empyreal's vendor, which happens to be located in San Bernardino County, in order to replenish its rolled coin supply." After the deputies realized that the coins had nothing to do with cannabis, they decided not to seize them. "When the Empyreal driver asked a deputy why Empyreal vehicles were being stopped so frequently," the company says, "the deputy told him it was 'political' but declined to elaborate."
Whether that response alluded to Dicus' own motivation or a federal agenda, it certainly does not sound like a reason that would pass muster under the Fourth Amendment. Empyreal argues that "pretextual traffic stops" aimed at supplementing police budgets rather than enforcing state law cannot qualify as "reasonable."
In addition to the cannabis industry, Empyreal, which operates in 28 states and has more than 200 employees, serves traditional businesses such as restaurants and convenience stores. Empyreal says it and its clients "operate in full compliance with
applicable state cannabis laws and all applicable federal and state money laundering compliance requirements," including the relevant provisions of the Bank Secrecy Act and marijuana-specific guidance from the Financial Crimes Enforcement Network.
"Empyreal is proud to provide a professional and secure solution for our customers to safely transport their deposits into the financial system, which increases transparency and makes communities safer by getting cash off the streets," CEO Deirdra O'Gorman says in a press release. "Because both we and our clients operate completely within the law, we have never had problems until recently. To continue serving our clients, we have no choice but to stand up for our constitutional rights."
Empyreal has reimbursed its clients for the money seized in Kansas and California, so it is already out $1.2 million, along with the legal cost of contesting the forfeitures. The company says it is trying to avoid further trouble by routing money from marijuana businesses around Kansas and San Bernardino County, which leads to needless extra travel. Empyreal has suspended plans for a "vault and currency processing facility" in Dicus' jurisdiction. It says it had already invested $100,000 in that project and continues to pay $21,000 a month in rent and utilities for the building. Empyreal says the threat of continued harassment and seizures has cost it clients and endangered the expansion of its business, especially in California.
"What is happening to Empyreal potently illustrates why we call civil forfeiture 'policing for profit,'" says Institute for Justice attorney Kirby Thomas West. "Law enforcement is trying to take more than a million dollars without charging anyone with a crime. That is absurd and deeply unconstitutional. It is yet another reason why lawmakers need to eliminate civil forfeiture altogether."
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Gee wiz, I hope the feds haven’t staged other stuff…
You mean like Foremost Fed #1 (the now EX-POTUS) staging a mythical Giant Election Fraud? A fraud kinda like Bigfoot… All sorts of people SAY that they saw Bigfoot, but when you go and LOOK for Bigfoot, all you find is some fur-tufts… Which, when DNA-checked, turn out to be bear fur?
How about that BIG GIANT FUCKING LIE??!? That Dear Ex-Leader the Loser STILL won’t take back?
https://www.salon.com/2021/04/11/trumps-big-lie-and-hitlers-is-this-how-americas-slide-into-totalitarianism-begins/
Trump’s Big Lie and Hitler’s: Is this how America’s slide into totalitarianism begins?
THIS alleged Big Lie?: “The (National Socialist) party as such subscribes to a positive Christianity without binding itself to a specific denomination.” That? Christian Front Republicans swore every word was true Gospel after FDR’s 1936 reelection by “commies and Jyooz,” then changed their minds during the Nuremberg trial showings of actual Catholic Action Eugenics pogroms at death camps. Totalitarians change both truths AND lies.
Everybody can earn $500 Daily… Yes! you can earn more than you think by working online from home. I have been doing this job for like a few weeks and my last week payment was exactly 2537 dollars.
For more info….
Money won’t ever be recovered.
The cops have already spent ALMOST all of it on cocaine and hookers! (And the rest of it? They WASTED it!)
The drivers should be thankful they weren’t also peacefully trespassing on public property.
I’m starting to wonder if every crime ever actually is committed by the establishment.
Reason seems to trying to hide that it is the “Party of Weed” administration heisting legal marijuana cash from a legal armored car company under federal civil forfeiture law.
Those tacky reasonoids must really irritate True Christian Trumpanzees™ with their callous disregard for the tu quoque reality control and “no true Scotsman” dogma that proves conclusively that when God’s Own Police State does it, it’s NOT looting or armed robbery. But both halves of the looter kleptocracy wrecked the economy in 1929 using asset forfeiture looting to enforce laws making production and trade a felony. Woodie Wilson vetoed the Prohibition Law. Gamaliel, Cal and Bert Hoover killed for it, FDR repealed it and became President For Life.
I hope IJ teaches their drivers in the fine points of don’t talk to cops. After the first hiest, the inside council should have supplied a scrip and held training classes.
If the drivers didn’t say what was in the back and where it came from the cops would have no reason to take it.
Or, put a news crew in the back that shoves a mic in the cops’ face when they search it.
When it becomes apparent that a police force to protect us from the police is necessary, it has already been accepted by all levels of government and the courts and drastic change is required.
Holy fuck, they aren’t even trying any more. The government has moved on to literal- not metaphorical- highway robbery.
Well, we should wait to see what the other side has to say.
But yeah, it looks really bad.
Inevitably, there will come a case where someone uses lethal force to repel those highway robbers in uniform.
Lysander Spooner explained the federal income tax law’s response to that: “If, in defending his property, he should kill any of our band who are assisting you, capture him at all hazards; charge him (in one of our courts) with murder, convict him, and hang him. If he should call upon his neighbors, or any others who, like him, may be disposed to resist our demands, and they should come in large numbers to his assistance, cry out that they are all rebels and traitors; that “our country” is in danger; call upon the commander of our hired murderers; tell him to quell the rebellion and “save the country,” cost what it may. Tell him to kill all who resist, though they should be hundreds of thousands, and thus strike terror into all others similarly disposed.”
If you didn’t wanna be treated like a thug, shouldn’t have been operating a legitimate business on the road like a thug.
Part of the problem here is that banking services for marijuana-based businesses is difficult to come by. Because marijuana is illegal at the federal level, banks risk losing their FDIC insurance if they take marijuana customers. That is probably why these folks had to turn to Colorado-based banks. But if the cops are going to make it very difficult to even transport the money, then what are these businesses supposed to do? The solution is just for Congress to legalize marijuana. Then the banks and the rest of the non-marijuana economy can do businesses with marijuana establishments without fear of negative repercussions.
That’s a huge part of the problem.
If they could be served by *any* armored car company, the cops wouldn’t be able to be quite as bold – It’s not like they’re going to stop every BRINKS truck driving down the road. But, really, they should be able to just use normal banks like any other legal business, as you mentioned.
I’m not sure if congress needs to pass a law to specifically ‘legalize’ marijuana to make that happen, though. Wouldn’t it be easier and still perfectly legal to de-schedule federally it as a ‘narcotic’? Of course, some state prohibitions would still stand in some places, but you wouldn’t risk losing FDIC insurance or other federal affiliations or contracts.
Ah, and the FDIC insurance was created to disguise the fact that Republican Prohibitionist asset-forfeiture looting caused the Crash, the Banking Panics of the Great Depression, and the Hoover-drafted fines-and-imprisonment Bank “Holiday” complete with confiscation of all gold. You wouldn’t want voters to find out a thing like that… Lookit how “nobody knew” Germany’s Christian government was operating mass death camps all over Europe. To this day Republican Cristian Fronters pretend that ever happened.
Mostly legal policing
State-chartered banks. No FDIC necessary.
Hire some
PinkertonBlackwater types to gaurd your trucks. Shoot any and all robbers.What’s wrong with putting dye packets in with the money the way actual banks do?
Fucking criminal
Black Bart approves.
Simple solution: bait cars, except instead of cash there’s just a woodchipper in the back.
I would be tempted to carry a safe full of murder hornets.
The government just keeps giving more and more reasons to hate government.
The looter kleptocracy does that. Cowards who lack the spine to vote libertarian make it happen.
I wonder why this didn’t make mainstream media headlines?
As Americans we are used to government taking our money. However let’s draw the line at taxes, this free for all by LEOs isn’t going to end well for someone. (Probably the good guys like us)
The Kleptocracy understands perfectly that asset-forfeiture looting caused the Crash and Great Depression, and repeated the same thing as of 1987 and 2008. Federal narc bureaucracies issue hardbound lies minimizing the murders and economic disasters their thugs bring about by carefully purging out all reference to specific dates. It wouldn’t to for someone to notice the market tanks and banks suffer liquidity contractions every time the FATF fingers someone as a laissez-faire scofflord so robbers move in. Ask Sullum.
That’s an interesting claim without any evidence to support it.
Most of us think the depression was caused by banking panic.
“By their nature, banking panics are largely irrational, inexplicable events,”
Upon what evidence do you base your claim that police asset forfeiture caused the depression?
Armored Car Heists are expensive.
The Founders would have these “cops” who are really highwaymen, tarred and feathered.
Low temp tar and packing popcorn are useful substitutes.