Inside the Philadelphia DA’s side hustle — selling seized homes to speculators and cops

In neighborhoods across Philadelphia, …police seized properties after drug raids. Once they were taken, the district attorney auctioned them off to the highest bidder, for cash that went back to the law enforcement agencies. The legal process is known as civil asset forfeiture.

…controversially, with no guilty verdict required.

…A forfeiture petition for one property lists one gram of marijuana, a half gram of cocaine and some over-the-counter pills as justification for taking. In one case recently settled in a $3 million class-action lawsuit, Norys Hernandez nearly lost the rowhouse she and her sister owned after police arrested her nephew on drug dealing charges and seized the house. Another family named in the suit fought to save their house from the grip of law enforcement after their son was arrested for selling $40 worth of drugs outside of it. Of the lawsuit’s four named plaintiffs, three had their houses targeted for seizure after police accused relatives dealing drugs on the property. None of the homeowners were themselves accused of committing a crime.

…The failure of law enforcement to plan for the reuse of these forfeited properties, which often held marginal real estate value, means that many wound up in the hands of absentee landlords or investors who often did not have the resources or motivation to improve the properties. The largest single buyer of forfeited property was a self-described real estate speculator who dabbles in rent-to-own schemes. As many as 325 of these properties appear to be vacant years after their sale and 427 are tax delinquent.

…Finally, records showed that members of Philadelphia law enforcement directly benefited from these sales. This investigation detected at least 11 properties that were sold to Philadelphia police officers trying their hands at real estate investment.

…The full number of sales to police could be much higher. But the Philadelphia Police Department refused to disclose any information about the sale of forfeited property to its officers and a spokesman for the DA said the office had not kept records of who bought auctioned property — or even how many properties were sold.

Critics say these sales to officers demonstrate a conflict of interest and highlight the ethical flaws in a system they say creates a financial incentive for law enforcement to take private property.

…These seizures were notably focused in black and Latino neighborhoods with high rates of poverty. Forty-one percent of all forfeited properties were concentrated in just four ZIP codes in North Philadelphia and Kensington, all with majority black or Latino populations and poverty rates well above the city’s average. For comparison, other large swaths of the Philadelphia, such as Center City, never saw a single property forfeited. Ever.

PlanPhilly | Inside the Philadelphia DA’s side hustle — selling seized homes to speculators and cops

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