Lawsuit Claims Indiana Unconstitutionally Seizes Millions in Cash From FedEx Packages Every Year

The Institute for Justice says Indianapolis police and prosecutors are exploiting one of the biggest FedEx hubs in the U.S. to seize cash for alleged crimes they never explain.

A new class action lawsuit accuses Indiana law enforcement of seizing millions of dollars a year in cash from FedEx packages without ever informing owners of what crime they're suspected of violating.

Henry and Minh Cheng, who run a small California jewelry wholesaler business, allege in a class action countersuit filed in Indiana state court that police seized over $42,000 in cash from a FedEx package en route to them from a client in Virginia. County prosecutors then filed a lawsuit to forfeit their money through civil asset forfeiture, claiming the Chengs' money was connected to a violation of a criminal statute, but the complaint never stated which statute.

The Chengs' suit, though, says they're not the only victims. The lawsuit says Indiana law enforcement officials "exploit Indianapolis's location at the Crossroads of America to forfeit millions of dollars in currency being shipped from one side of the nation to the other."

The Chengs' countersuit against the Marion County Prosecutor's Office and the State of Indiana was filed on their behalf by the Institute for Justice (I.J.), a libertarian public interest law firm that has challenged civil asset forfeiture laws in several states.

According to I.J., the Marion County Prosecutor's Office has sued to forfeit $2.5 million in currency from at least 130 FedEx parcels in transit from one non-Indiana state to another over the past two years.

"This scheme is one of the most predatory we have seen, and it's past time to put a stop to it," I.J. senior attorney Sam Gedge said in a press release. "It's illegal and unconstitutional for Indiana to forfeit in-transit money whose only connection to Indiana is the happenstance of FedEx's shipping practices."

Under civil asset forfeiture laws, police and prosecutors can seize property suspected of being connected to criminal activity, even when the owner is not convicted, charged, or even arrested for a crime. Law enforcement groups say civil forfeiture allows them to interdict and disrupt organized crime like drug trafficking by seizing its illicit gains. 

However, civil liberties groups argue lax safeguards and perverse profit incentives lead police to brand any large amount of cash as drug money, even in cases where no drugs are found and even though traveling with large amounts of cash is legal.

In this case, though, I.J. says Indiana's Marion County Prosecutor's Office isn't even bothering to articulate which crime the seized cash is allegedly facilitating.

According to the Chengs' countersuit, their business sold $42,825 in jewelry to a store in Virginia in January. (Their lawsuit includes an image of the receipt.) When the payment was late, the buyer offered to send the full amount in cash immediately through an overnight FedEx delivery.

The package was routed through FedEx's massive hub in Indianapolis, Indiana. The hub is the second-largest in the country and processes up to 99,000 parcels an hour.

At the Indianapolis FedEx Hub, an Indianapolis Metropolitan Police Department officer flagged the package as "suspicious" and showed it to a K-9 unit, which alerted to it. 

According to the Chengs' countersuit, the officer's warrant affidavit listed several of the package's "suspicious" characteristics, such as having all the seams taped, which the FedEx website recommends, and several factually incorrect statements—such as a claim that the delivery did not have a signature requirement, when in fact it did.

The Marion County Prosecutor's Office then moved to forfeit the Chengs' cash under Indiana's civil asset forfeiture statute. However, the complaint only stated that the "seized currency was furnished or was intended to be furnished in exchange for a violation of a criminal statute, or is traceable as proceeds of a violation of a criminal statute, in violation of Indiana law, as provided in I.C. 34-24-1-1."

"The government can't even identify a crime that would allow them to keep the money that we need to run our business," Henry Cheng said in an I.J. press release. "We were shocked when we found out what was going on in Indianapolis and we want to put a stop to it."

I.J. argues that the Marion County Prosecutor's Office systematically files deficient civil forfeiture actions against seized cash that never identify what specific violation of Indiana criminal law supports the forfeiture.

What this all means for out-of-state owners is that they must find and pay for an Indiana lawyer to fight an unspecified allegation. A cynical person might suspect Indiana is targeting these packages on the assumption that most owners will look at the time and cost of challenging the seizure and not bother.

The countersuit alleges that, because Marion County prosecutors do not articulate a legal basis for the seizures, their pleadings are deficient, they fail to duly notify owners, and they lack jurisdiction to seize packages originating in and bound for other states. I.J. argues this scheme violates a wide range of constitutional rights, including the Fourth, Eighth, 10th, and 14th Amendments.

The countersuit seeks injunctions in favor of the Chengs and similarly situated plaintiffs, as well as injunctions declaring the Marion County Prosecutor's Office's policies unconstitutional.

The Marion County Prosecutor's Office declined to comment, citing the pending litigation.

Comments

[Idaho-Bob]

The countersuit seeks injunctions in favor of the Chengs and similarly situated plaintiffs, as well as injunctions declaring the Marion County Prosecutor’s Office’s policies unconstitutional.

Until “unconstitutional” becomes criminal, with criminal punishments, this shit will never end.

Right now, there are Indiana package pigs bitching they may have to stop this piracy.

[StevenF]

Unconstitutional actions by the government ARE criminal.

[sarcasmic]

These guys think the Sheriff of Nottingham was the hero of the story.

[Rick James]

County prosecutors then filed a lawsuit to forfeit their money through civil asset forfeiture, claiming the Chengs' money was connected to a violation of a criminal statute, but the complaint never stated which statute.

When your government is essentially YouTube.

[Uncle Jay]

"Lawsuit Claims Indiana Unconstitutionally Seizes Millions in Cash From FedEx Packages Every Year."

Crime pays...but only if you're a government employee.
This is a good example.

[Quo Usque Tandem]

We all know that cash is untraceable, which makes it beyond government oversight; ergo, cash is criminal, right? Guess that is all you need to know...

[I am not paying for your stinkin' subscription]

Tammany Hall ver. 2.0

[diver64]

It's about time people stood up to this official theft. I often send large sums of money through the mail for no particular reason and don't like that the government could seize it for no reason.
Seriously, The Cathedrals insatiable need for more money to feed it's endless appetite will never end until we are all living in government houses eating bugs.

[Sinuk]

An allegation is all that is required to impose a legal sanction as long as the allegation comes from someone with an affidavit of having completed a LEO academy.

[Get To Da Chippah]

Baldredash. As long as any one of those packages was connected to a crime, then the confiscation of all of them is perfectly legitimate. It's not as if you have a right to not have your property taken away by the cops.

Know your rights, Losertarians!!

[diver64]

Except the pesky fact that no crime was alleged or charged.

[Jerry B.]

No specific crime. If they think there may have been one, even if never defined, that's enough.

[Squirrelloid]

AT to show up to argue this is all perfectly rational policing in 3... 2... 1...

[AT]

I wouldn't go that far. But, as I point out below, everything about this story is super weird.

[GroundTruth]

The war on cash continues in another guise.

[AT]

OK, so without getting into the ethicality of CAF, you gotta ask:

According to the Chengs’ countersuit, their business sold $42,825 in jewelry to a store in Virginia in January. (Their lawsuit includes an image of the receipt.) When the payment was late, the buyer offered to send the full amount in cash immediately through an overnight FedEx delivery.

Who does that in 2024? Why would anyone even trust FedEx (or any other shipping company) with that sort of thing?

As usual, I don’t think we’re getting the whole story here.

And as you dig deeper into it, it’s even moreso: f. “The listed phone numbers are duplicate numbers for the sender and receiver.” g. “The receiver’s name listed, only has a first name and no surname.”

Come on, that’s fishy. Now, giving the benefit of the doubt, it sounds like we’re dealing with two Vietnamese businesses – by all accounts who have been doing business for some time – a wholesaler and a retailer. Henry Ming (the wholesaler), according to CA SOS, has a principle address of a residential home (and, also super weird, recently changed that address to another residential home seven houses down).

The address on the receipt (which is also sus af) isn’t terribly far from those home addresses – but what I’d really like to see is that address on the FedEx package. They say it’s Exhibit 1, but it’s not on Emma’s link.

So… maybe it’s just a Vietnamese thing? “Sure, go ahead and send large amounts of loose cash through commercial package delivery – and only use my name and information on the labels.”

Still, it’s weird.

19. “Suspicious” factors also include that the parcel’s destination is in California—a “source state” (according to officers) that is also by far the most populous state in the nation.

That’s probably a tax thing. And that might actually be what’s at issue here. If a California business is generating income from customers in Virginia, and they’re receiving payment entirely in cash – meaning arguably it’s under the table deals – that could be a problem, and a basis for intercepting the monies.

But, admittedly, that’s a stretch and a strain, because how would some Indiana cop glean that just from spotting a suspicious package that a K9 alerted on? Unless there’s an added layer to why cops are hanging out at the FedEx hub with K9’s on site that CJ failed to report on.

Anyway, it’s weird. Everything about this is weird. I’m not suggesting anything untoward going on – but I can see why this package would seem suspicious; I can’t wrap my head around why two businessmen, both in business for decades, on opposite coasts would do things this way in 2024; and it’s not made clear whether the buyer had already taken delivery of the jewelry or needed it with such urgency that necessitated an overnight cash payment.

CJ should have dove into this a little more before she “reported” yet another one-sided complaint, ACAB gripe, and CAF clickbait.

[CE]

So prove a crime was committed. Then let a judge set the fine.
If not, return the evidence promptly.

But where is the probable cause? Where is the warrant?
How can a package be intercepted and searched when no crime has been reported, and no case is in progress against the suspects?

[AT]

Well, again, if you want to have a CAF discussion we can do that – but that’s not really relevant to the conversation.

But where is the probable cause? Where is the warrant?

You read the complaint, right? I mean, you wouldn’t be replying just from a kneejerk reflexive position of pre-existing prejudices that were affirmed by believing an obviously bogus narrative like the ones Reason constantly traffics in, right?

Right?

To answer your question:

69. The officer’s affidavit recounted that, having pulled aside the parcel, the officer presented it to a K-9.
70. The officer’s affidavit further recounted that the K-9 alerted to the parcel.
71. The officer then obtained a warrant.
72. The officer then opened the parcel and found the $42,825.00 in currency

How can a package be intercepted and searched when no crime has been reported, and no case is in progress against the suspects?

That’s actually a really good question – and one that I brought up. See, like with luggage, that’s in what’s legally known as in a “public place” where there is no reasonable expectation of privacy. And dog searches are particularly useful because they can avoid a privacy invasion by keying in specifically on what is almost certainly contraband. That creates probable cause. And since we have no privacy interests in illegal contraband, it justifies the search.

But I’m not so sure a FedEx hub qualifies as a “public place,” (unless “public place” applies to packages in commercial transit in general – and I don’t think it does, but I could be wrong) which is why I pointed out the deficiency in CJ’s reporting of diving into precisely why cops are hanging out at the FedEx hub with K9’s on site.

There’s got to be a reason, they just didn’t bother to look into it. So, I don’t think you’re going to get an answer on that particular front. Even though it’s the most important angle of the story.

ACAB’s gon’ ACAB. It’s just how they are.

[Dude 2]

Yeah, it is weird. No crime, but evidence that "seized currency was furnished or was intended to be furnished in exchange for a violation of a criminal statute." It's like cops merely quote the law to cover what they're doing, rather than citing a law someone broke.
Also weird, criminals, but no arrests. It's like cops live in a surrealistic world of legal evidence, but no legal proceedings like trials.
Even weirder, cops are overpaid for not doing their actual jobs and even for doing the opposite of their jobs.

[AT]

No crime, but evidence that “seized currency was furnished or was intended to be furnished in exchange for a violation of a criminal statute.” It’s like cops merely quote the law to cover what they’re doing, rather than citing a law someone broke.

Well, I mean, it’s not rocket science.

So, suppose instead of money, they had found explosives. They would similarly seize the explosives – even if they weren’t sure what the sender or the recipient was planning on doing with them. Because obviously we don’t want them getting to their intended destination TO be ultimately used for nefarious purposes. No crime had been committed – yet – but on its face shipping explosives across the country via FedEx is very suspect.

Now, the obvious counterargument is that shipping most explosives is illegal, or at least heavily regulated, in the first place, but the point I’m trying to make – without wading too deep into the ethicality of CAF itself – is that the suspicion of criminal activity is a valid one. And we don’t want to inadvertently empower it by allowing contraband to reach its intended destination.

And, of course, if ones property IS wrongfully seized, there is a process for explaining it and getting it returned. Reason, among others, likes to whine about how “difficult” this is – but it’s just that: whining. You can bet your butt that if it were MY law-abiding property to the tune of $50K that was seized, I’d cross every T and dot every I to get it back. Just like our Mr. Ming here.

Reason whines that it’s “too hard”. But that’s an obvious obfuscation meant to hide the fact that the reason most people don’t bother is because the property actually was connected to some criminal activity. Like that dude in SC with the quarter mil in his bag. "That's not mine, never seen it before!"

Sure Jan.

Lot of money to immediately distance yourself from if everything were on the up and up.

That’s the quiet part folks like CJ don’t want said out loud. It's not actually about privacy. It's about empowering crime. Crimes they wish weren't crimes perhaps, but crimes all the same.

[Krayt]

Does Indiana enforce tax laws in California or Virginia? Would Indiana be sending the seized cash to them, or just keep it?

[AT]

I don’t know. Like I said, it’s a strained argument in the first place. I only mentioned it because the cop’s use of the term “source state” is indicative of some tax-related thing.

CJ (and Emma, and ENB... well, most of the Reason writers, come to think of it) intentionally doesn’t give us the full story on this stuff when he writes these nonsense ACAB articles, so it’s hard to tell what 5-0 was doing there in the first place and why.

[CE]

So did the dog alert on the cash, because the Indiana cops have trained them to alert on cash now?

Or had some of the bills been used by Hunter Biden as straws?

[AT]

Be kinda neat if they did.

But, truth is, most paper currency has trace evidence of drugs on it. That's why dogs pick up on large sums of it so easily. They're not sniffing out the one that was rolled up to snort coke, they're sniffing out the stack it was shuffled with in that helped get that coke over all the rest of the bills as it brrrrpttt'd through a bill counter.

Kind of the same thing as the toilet plume. Which is also invisible, but still gross.

[Dude 2]

Right, so a dog "alert" (wink,wink) like this one should never be considered the probable cause needed for issuing a search warrant.

[AT]

There is a grave misunderstanding, among folks on this website, about how K9 units work.

An intentional one, it seems.

If anything, you would think libertarians (which we all know nobody here is, more marxistarian or lolertarians or losertarians) would be the greatest proponent, advocate, and defender of K9 searches. They are, without a doubt, the least intrusive means of police investigation and the single greatest check to avoid unreasonable invasions of privacy.

[Krayt]

There was a magic horse called "Clever Hans", who could do simple math.

They proved it was a scam by filming the handler and the researchers could tell the number without knowing the question, just by cues, the same way the horse knew to stop tapping its hoof.

I wonder if K-9 can pass that test.

[AT]

No idea. Doesn't matter.

So, look, a K9 alerts on contraband, right? That becomes the basis for the search warrant. If you want to challenge that search on 4A grounds, you absolutely can. K9 handlers and trainers have to keep meticulous records on the dog's performance, accuracy, and continued training/certification - and if those records are deficient, the State won't then be able to rely on them to justify the original search, meaning the evidence gets thrown out. Similarly, if you can establish that a dog is alerting on things that ultimately turn up no contraband more often than it does, the fruits of the K9's alert can also be thrown out. Like, if a dog has an accuracy rate of less than 50% (possibly even higher), you've got a strong argument that its alerts can't be relied upon to justify a search.

And the thing is, the dogs are pretty reliable. Their training - at least in detection - is really deliberate and it teaches them to both distinguish and alert in specific ways (that is, a K9 will alert in a different way when it scents on drugs than it will, say, explosives or human remains - the former might be indicated by a bark or scratch, the latter indicated by the dog sitting and becoming very still so as not to disturb the scene). Military dogs are like this too, and it's why soldiers take them very seriously and hold them in great esteem. If a dog alerts on an IED, you can bet darn well they're taking that dog very seriously and not questioning whether or not his handler is cueing him.

Folks here, otoh, seem to be really bent on this notion that handlers are cueing their dogs to alert. Probably because it's the only argument they have to make. But it's just not the case. If it were, they wouldn't be turning up contraband with as much accuracy as they do, and cases built off them would be getting thrown out left and right. I get that's a prejudice that marxist/lolertarian ACAB's want to believe, because they just hate the practice (and cops) in general - and they're coming at it from a position of pure ignorance and zero reasoning.

Again: the least intrusive means of police investigation and the single greatest check to avoid unreasonable invasions of privacy. Anyone who values privacy and avoiding unreasonable searches should be championing K9 detection. "Libertarians," oddly, don't.

(And I'll bet top dollar is that the reason is because they want to commit the crimes that K9s so effectively frustrate, and loathe the well-established Constitutional Law that says there's no reasonable expectation of privacy when it comes to illegal activity/contraband.)

[markm23]

Dogs are better at reading human body language than humans are. If the handler wants the dog to alert, the dog knows it - the handler does not even have to intentionally give any signals to the dog.

[AT]

But again, why would he - unless he's a moron trying to get his dog decertified.

[John C. Randolph]

Government thieves steal more from the American people than all the non-government burglars, muggers, and embezzlers put together. This happens because we, the American People, failed to correctly apply tar and feathers to the first miscreants who pulled this shit.

-jcr

[Uomo Del Ghiaccio]

To me it's simple. If property is to be confiscated and forfeited there need to be a criminal charge and conviction with a clear connection that the property in question is directly related to the criminal charge that the person was convicted of.

If there is not a direct connection to the conviction then the property should not be forfeited. If the crime included a victim who is owed compensation, the the property would be eligible for consideration through a separate court.

At no time should law enforcement receive the proceeds from forfeited property simply because there is a glaring conflict of interest. Any justifiable forfeited property should go something such as into providing better legal council for people who can't afford legal council.

[Krayt]

Politicians have little motive to end the highway robbery. That's billions of dollars they'd have to come up with restored funding for.

[Sinuk]

What is the State doing at a FedEx distribution center? Is FedEx an agency of the government with government employees working at their facilities?