Ill-conceived plan threatens crime inquiries

2011-09-01 14:19:15 | Source

The proposal by a state senator to take monies seized in racketeering cases and put them into the state's general fund is not only ill-conceived, it could hinder criminal investigations in Arizona and make it harder for victims of crime to receive compensation.
Earlier this month, Sen. Robert Burns, R-Peoria, the influential chairman of the Senate Appropriations Committee, suggested that legislators, and not Attorney General Terry Goddard, should decide how money seized under the Racketeer Influenced and Corrupt Organizations Act, or RICO, should be disbursed.
Goddard is against the proposal and as a result, he said, his budget is being held up by Burns in the Legislature.
In a meeting with the Star's Editorial Board, Goddard said the proposal to change the way seized monies are disbursed came about because Burns apparently was unhappy that about $17.3 million from a huge RICO seizure went to fund an expansion of the Department of Public Safety crime lab in Tucson.
That money came from the state's years-long prosecution of C.P. Direct, a Scottsdale-based Internet company that made close to $78 million by selling bogus penis- and breast-enlargement pills. The state netted about $32 million from the case. About $4 million went to victims of the pill scam and the rest was split between DPS and the Attorney General's Office.
"That's a very appropriate nexus  using proceeds from criminal activities to fight other criminal activities," Goddard said. "That's the way RICO was set up to work."
However, if Burns' proposal were to become law, in the future law-enforcement agencies and prosecutors would have to appeal to legislators for money to fight RICO cases.
The Burns plan is a bad idea.
After victims are compensated and law-enforcement agencies get their share of a RICO seizure, the Attorney General's Office puts any remaining money into a revolving RICO investigation fund. That fund is used whenever needed to quickly pay for wiretaps and other elements of a criminal investigation.
It would be unreasonable and cumbersome for prosecutors to ask the Legislature for funds every time they need money, especially when they need to act quickly.
Pima County Attorney Barbara LaWall, who handles RICO cases locally, told Burns in a letter: "Many RICO projects are funded at small amounts. Even if these small projects can be predicted in advance, the Legislature would be considering hundreds and hundreds of small appropriations on an annual basis, which is not an effective use of member and staff time."
Burns should also understand that the C.P. Direct case was unusual. Goddard said few RICO cases result in a windfall for the state. "In many cases, victim compensation eats up the whole pie," Goddard said.
Putting seized monies into the state's general fund could discourage law-enforcement agencies from taking part in big cases, which wouldn't be good for public safety.
"If the money is controlled by the Legislature, the law-enforcement agencies know they aren't going to get their costs back," Goddard said. "With us, there's a chance that they'll get back a share of their costs, and that's why they shop at our store."
As for victims of fraud and other racketeering crimes, they would also have to wait for the Legislature to decide what it would give them. If the Legislature is out of session, that means having to wait even longer to be compensated.
Under the current system, victims are paid quickly once monies from a RICO seizure come under the control of the attorney general or county attorneys.
"The removal or reallocation of funds to the appropriations process would negatively impact victim compensation and victim rights," LaWall wrote to Burns. "More money goes to racketeering victims through Arizona RICO actions than to all Arizona law-enforcement RICO expenditures combined."
The Legislature should leave control of RICO funds just where it is, with the Attorney General's Office. The monies gained from RICO cases are an unpredictable source of revenue and shouldn't be part of the annual appropriations process.
Goddard's office isn't misusing the money, and Arizonans benefit when he has quick access to cash for investigations that serve the public good.
We urge lawmakers to reject Burns' proposal and release his hold on the attorney general's budget.

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