In a real life version of Rebel Ridge, a veteran is fighting the “civil forfeiture” program that gives state and local cops an incentive to grab your assets–even when you’ve committed no crime.
By Kelly Phillips Erb, Forbes Staff
It sounds like the opening of the Netflix hit movie, “Rebel Ridge.” But it happened in real life and the consequences are still playing out in the Nevada courts.
On February 19, 2021, retired Marine Stephen Lara was making the 1,400 mile drive from Lubbock, Texas to Portola, a small California town near Reno, Nevada, where his teenage daughters lived with his ex-wife. Early in the Covid-19 pandemic, Lara, now 42, was laid off from his hospital systems administrator job in California and moved in with his parents in Lubbock to save money–and to save up for a house.
Lara had driven this four-day round trip dozens of times and it had become almost routine. This time, however, he was pulled over by the Nevada Highway Patrol on I-80 near Sparks, Nevada—about an hour from Reno–ostensibly for following and passing a tanker truck too closely. He wasn’t issued a traffic ticket or warning, let alone arrested or charged with a crime.
Yet the 90 minute encounter ended with the officers seizing Lara’s life savings–some $86,900 in cash he had in a Ziploc bag secured by his daughters’ hair ties–and sending the money to the federal Drug Enforcement Agency for potential “civil forfeiture.” What that means is that despite the fact Lara was not charged with a crime, the feds could legally keep his money, kicking back $69,520 of it to the Nevada Highway Patrol as a sort of finder’s fee.
More than six months later, Lara got his cash back—but only after The Institute for Justice (IJ), a libertarian not-for-profit law firm which fights what it sees as government abuses, sued the DEA on his behalf. Now, with IJ still representing him pro bono (for free), he’s asking Nevada courts to rule that the state’s constitution, which protects property rights, bars the Nevada Highway Patrol from participating in the “equitable sharing” civil forfeiture program run by the feds–something almost all states now do.
Earlier this year, Lara won a preliminary round in his Nevada case when a trial judge rejected the highway patrol’s motion to dismiss the lawsuit. A trial is scheduled for next June. If he ultimately wins, it could set an important precedent and inspire legal challenges in other states.
From 2000 to 2019, by IJ’s count, the feds sent a whopping $8.8 billion in civil forfeiture payments to state, local and tribal law enforcement agencies that had seized assets under the joint program.
When Lara was being pulled over by the highway patrol, he thought it might be because there was something wrong with his rental car, maybe expired tags. But the patrol officer politely explained that while “it appears you’re trying to drive safely” the NHP was waging a public information campaign about little-known traffic violations. And Lara, he said, was following the truck too closely and had passed too closely.
The officer then asked Lara to get out of his vehicle. Muscular, with close-cropped hair and service in both Afghanistan and Iraq under his belt, the ex-marine played it by the book–he was cooperative throughout the stop, answering the officer’s questions, including about the purpose of his trip and his military service. All this can be seen in videos recorded by the officers’ dash and body cams that the IJ got through a public records request.
Just as the traffic stop appeared to be over, the officer asked if Lara had any firearms, explosives, or drugs in the car, and he answered truthfully that he did not, adding, “I don’t do drugs.” Then the officer asked whether he had large amounts of cash and Lara said he did, explaining that he didn’t trust banks.
With that revelation, the officer asked if they could search his vehicle. He agreed, and the officers looked through the car, including the trunk, with the help of a drug sniffing dog. They didn’t find any drugs or firearms, but they did find Lara’s already-disclosed bag of cash.
Because of his distrust of banks, Lara had kept his savings in cash for as long as he can remember. That’s not as unusual as it sounds. Based on a 2021 national survey, the Federal Deposit Insurance Corp., estimates that 14% of U.S. households were “underbanked” (meaning they have at least one household bank account but use alternatives) and another 4.5% were unbanked (with no bank accounts at all). Significantly, both the unbanked and underbanked rates are much higher, at all income levels, for those who are Black or (like Lara) Latino. In the FDIC survey, the unbanked cited distrust of banks as the second most common reason they shun conventional accounts–second only to bank fees.
After Lara’s income was deposited in his bank account, he would withdraw it. In fact, he had years of ATM withdrawal receipts in a backpack along with the $86,900 in cash. He’d brought the cash hoard along with him, he later explained, because his parents were going to be away for the weekend and he didn’t want to leave it in an empty house.
Driving across state lines with a bundle of cash isn’t a crime—a fact that the officer acknowledged at the scene. If you are crossing the U.S. border, there are still no U.S. limits on the amount of money you can carry, but if you’ve leaving or entering with more than $10,000 in cash or cash equivalents you must report it to U.S. customs officials. If you don’t report your cash when crossing the border, it can be confiscated by the authorities.
Even though Lara had committed no crime, and the officers, after a thorough search found no contraband, a sergeant from Nevada Highway Patrol arrived on the scene, consulted with the DEA, and ordered that the money be seized. “If it is legitimately earned income, you’re going to be able to provide those pay stubs, and they will give you all your money back, but I believe it’s drug proceeds,” the sergeant said. (The evidence? The dog sniffed at the money, but most U.S. currency has trace amounts of drugs on it.) “You’re taking money out of my kids’ mouths. You’re taking food out of my kids’ mouths,’’ Lara protested.
Lara was then told he was free to go—without his cash. Not surprisingly, as someone who doesn’t trust banks, he doesn’t have credit cards. With only a few dollars left in his jacket pocket, he had to ask his brother to wire him money so that he could complete his trip.
This is all eerily similar to the opening of Rebel Ridge, in which former Marine Terry Richmond, played by Aaron Pierre, is on his way to bail his cousin out of jail and is pulled over by a pair of police officers in the fictional small town of Shelby Springs. The officers who stop him seize the cash he’s carrying, a process, they explained in the film, called civil forfeiture. Writer-director Jeremy Saulnier told Netflix that the film wasn’t based on a true story, but added “elements of it could certainly happen.” The movie lasts two hours.
Lara’s ordeal has gone on for a lot longer. When he got home, he called the DEA number listed on the receipt that the officers had issued to him, assuming–as the officers had told him–that if the money was legit he’d get it back quickly.
Under the civil forfeiture law the government can seize and keep your property if it merely suspects the property is connected to a crime. The kicker? Often, the government doesn’t have to offer any proof, nor does the property owner have to be charged with a crime for the government to seize the property. (This differs from criminal forfeiture, where property is generally turned over to the government after a conviction.)
On April 5th, 2021, the DEA issued Lara a notice that it intended to seize his property, giving him 35 days to formally protest. On April 21, Lara wrote a letter to the DEA asking for his property back. According to its own procedures, the government had 90 days after the April 5th notice to either return Lara’s property, initiate civil forfeiture proceedings in court, or begin criminal proceedings. However, despite the government’s acknowledgement of Lara’s written request to return his property, that 90 day deadline passed without the government doing any of that.
At that point, Lara had no choice but to file suit to get his property returned. Lawsuits can be expensive—especially in federal court. According to IJ, which focuses on abuses of government power, the average currency forfeiture is just $1,276 (that number is based on 21 states with available data). Hiring an attorney costs at least double that, which is why most people don’t get their property returned.
But Lara’s case seemed so outrageous, that IJ took it pro bono and filed suit against the DEA on August 31, 2021, more than six months after Lara’s property was seized. The very next day, the DEA agreed to return Lara’s money with interest, says IJ lawyer Benjamin Field, because they “never had any reason to keep it.” (Field is a 2015 Yale Law grad with a libertarian streak and a degree in economics from the University of Chicago. He quit a high paying job in corporate law and moved to IJ in 2021 because he wanted “to do something that was more meaningful.”)
All of which raises the question: Why exactly would the Nevada Highway Patrol turn over cash it seized to the DEA in a case without criminal charges?
The answer is a process, first established by the Comprehensive Crime Control Act of 1984, known as “adoption.” When state, local or tribal law enforcement agencies seizes asset—whether cash, cars, or other property—that they suspect might be related to a crime, they can hand it over to the DEA or one of a slew of other federal law enforcement agencies and let the feds handle the legal work of civil forfeiture. If the feds end up keeping the money, they kick back up to 80% to the law enforcement agency that originated the seizure—a process known as “equitable sharing.”
After public scrutiny of civil forfeitures and the incentives created by equitable sharing, in 2015 Obama Attorney General Eric Holder limited the civil forfeiture cases in which the feds could “adopt” a local seizure and then kick back money. But Holder’s restrictions were reversed in 2017 by then-Trump Attorney General Jeff Sessions. In 2019, federal agencies made $334 million in “adoption” payments to state and local law enforcement. The IJ contends those kinds of arrangements create an incentive for state and local law enforcement to seize property even when there is no real evidence of a crime.
In Lara’s case, the NHP stood to pocket $69,520 from seizing his cash and shipping it to the DEA.
Almost every state has a civil forfeiture program. While the laws differ from state to state, most follow a similar pattern and do not require convincing proof of any commission of crime by the owner—simply a “preponderance of the evidence.” Some states, like Delaware and Rhode Island, merely require probable cause. Only a handful of states, like Arizona, require a criminal conviction.
Lara’s ongoing suit against the Nevada Highway Patrol, also filed in August 2021, asks the court to declare that state law does not allow for federal adoption and equitable sharing and to award him both compensatory damages and lawyers’ fees. Lara won the first round when, earlier this year, a judge rejected the highway patrol’s motion to dismiss the lawsuit. (The case had been delayed earlier for more than a year while Nevada’s high court considered–in another case–whether the state could be sued. It ruled that it can be sued.)
Field is hopeful that the landscape is changing, noting that some states have instituted reforms and four—Maine, Nebraska, New Mexico, and North Carolina—have even abolished civil forfeiture.
Still, Field says, big problems with civil forfeiture remain. One is that the laws on the books make it difficult for those who are targeted to fight back. “The system is built,” says Field, “so that people don’t contest it.”
Pushing back isn’t easy. After the government took his money, Lara’s life—and plans to buy a house to be near his daughters—were put on hold. He has since moved to Chico, California, where his ex-wife and daughters now live.
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