ERAD, Because It’s Not Just About The Cash (Update)

What are the chances Oklahoma, of all places, would be on the cutting edge of high tech? Yet, when it comes to glomming money, they’re on it. Like flies on shit.

The Oklahoma Department of Public Safety has purchased Electronic Recovery and Access to Data machines for installation in Oklahoma Highway Patrol and Oklahoma City police cruisers, according to an Oklahoma Watch report published Tuesday. The device tells officers the balance of prepaid debit cards and gift cards, and allows them to seize the money if they determine it’s suspicious. ERAD readers also can provide limited information about pretty much any card with a magnetic strip, including bank debit cards and credit cards.

This explanation is slightly flawed, which is understandable given its source. You see, ERAD enables cops to seize money.  Whether they “determine it’s suspicious” or not is spin, and even as spin goes, it’s wrong.

Here’s how it works. If a trooper suspects you may have money tied to some type of crime, the highway patrol can scan any cards you have and seize the money.

“We’re gonna look for different factors in the way that you’re acting,” Oklahoma Highway Patrol Lt. John Vincent said. “We’re gonna look for if there’s a difference in your story. If there’s someway that we can prove that you’re falsifying information to us about your business.”

The purported basis for seizure and forfeiture is to “take the profit out of crime,” which is one of those cute slogans with which lovers of fortune cookies readily agree. After all, who wants criminals to enjoy their ill-gotten gains? But then, advertising slogans may work well enough to sell laundry detergent, but they make for a particularly poor basis for legal doctrine.

At best, that there is something “suspicious” may give rise to the taint of underlying nefarious conduct, but is so vague and meaningless, not to mention potentially total malarky, that it provides no basis to take money or property from someone.

But then, that’s not what the Oklahoma Highway Patrol guys are talking about at all.  They are looking for a “difference in your story,” as if there is a requirement that a story be told, that people have to explain their “story” to road cops at all, and that it has to meet the approval of a highway patrol officer’s notion of a satisfactory story. Then, of course, there is the question of whether the cop really couldn’t care less and just wants the money, story be damned.

All of this is, and has been, a monumental problem rife with abuse for decades. Nothing new here? Oh no, there’s something very new, and it raises the ante to a whole different level.  Until now, roadside seizures were limited to the cash or property on hand. Traveling to Disneyland with a wad of dough so your kids could ride Dumbo? Watch a cop’s face light up. This was bad enough.

With ERAD, however, they can take it all. In the bank? Gone. Credit card? Maxed, plus that high interest loan the bank was hoping against hope you would take. Anything. Everything. If there’s a magnetic strip on it, it’s theirs.

But the cops don’t want you to be afraid, because they would never abuse their card reader.

“I know that a lot of people are just going to focus on the seizing money. That’s a very small thing that’ s happening now. The largest part that we have found … the biggest benefit has been the identity theft,” Vincent said.

“If you can prove can prove that you have a legitimate reason to have that money it will be given back to you. And we’ve done that in the past,” Vincent said about any money seized.

Courts are for kids. It’s the cops you have to convince. The best spin they can put on it is that people now have to “prove” the legitimacy of the money they have in the bank to the cop. Earned it working? Prove it. Prove it when you’re in your car driving down the road. Prove it when you’re three states away from wherever it is you work.

And no police officer would ever be too stupid to grasp that it’s legitimate.  Worse yet, no police officer would ever shrug, steal every penny he could and tell you to go to court and try to get it back. Just because he could.

And no police officer, just because you took umbrage to his cleaning out your bank account on the side of the road, would ever use force to teach you not to be disagreeable. If you’re lucky, it will be limited to a tasing with a knee in your back and a few punches to your face. If not, it’s a bullet.

It doesn’t matter that the root of the violence was a cop’s seizing your money because he decided your story didn’t add up. After all, your non-compliant reaction could strike fear of harm and violate the First Rule of Policing, giving the officer every reason in the law to kill you for his own safety.  With total judicial approval.

All of this is, of course, already at risk by the concept of civil forfeiture, by the authorization of cops seizing cash and property at will, shifting the burden of fighting for its return upon the owner. But ERAD raises the stakes to a level heretofore unrealized.  It’s no longer just the cash in your pocket at risk, but your life savings. Plus.

On the bright side, Republican State Senator Kyle Loveless gets the problem.

State Sen. Kyle Loveless, R-Oklahoma City, said that removes due process and the belief that a suspect is presumed innocent until proven guilty. He said we’ve already seen cases in Oklahoma where police are abusing the system.

“We’ve seen single mom’s stuff be taken, a cancer survivor his drugs taken, we saw a Christian band being taken. We’ve seen innocent people’s stuff being taken. We’ve seen where the money goes and how it’s been misspent,” Loveless said.

Loveless has introduced legislation to require a conviction before forfeiture, which makes law enforcement groups feel bad.

Law enforcement groups have lobbied hard against the legislation, calling it a gift to criminals and an unnecessary attack on their profession.

In the meantime, leave your gift cards at home, all you criminals, as they have magnetic strips too.

Update: As if this wasn’t bad enough, it gets worse (h/t Brandon Fetch).

The contract signed by the state and ERAD Group, obtained by Oklahoma Watch, states that Department of Public Safety will pay a one-time $5,000 implementation charge and a $1,500 training charge for the devices.

ERAD Group will receive a 7.7 percent cut of all funds seized via the card readers. Vincent said the 16 prepaid card readers obtained by the department were installed in May.

No, there is no rationale to explain why ERAD Group should get a cut of the vig.

40 thoughts on “ERAD, Because It’s Not Just About The Cash (Update)

  1. DaveL

    Credit card? Maxed, plus that high interest loan the bank was hoping against hope you would take.

    Has this ever actually happened? Police taking out loans from third parties in a suspect’s name under the guise of civil forfeiture?

    1. SHG Post author

      Not yet that I’m aware of, but if they can do it, it will eventually happen. After all, why should the “suspect” enjoy the benefit of spending loot on, say, dinner, and deny it to the highway cop when he can get the “proceeds” back with the push of a button?

      1. Dave

        The article talks only about pre-paid debit cards, which don’t generally require a PIN. A bank card does, and so the cops can’t take anything unless you foolishly give them your PIN. A credit card is right out – my card company would likely refuse to honor a large transaction (as it is “suspicious”, there is irony) if the police tried to do one. And of course you can always call and dispute a charge you did not agree to, and the credit card company can’t charge you if it was without your authorization, another benefit of credit cards over cash or even debit cards. Still, utter bullshit even with the pre-paid cards.

        In my nirvana, you would need a criminal conviction first before money could be seized. And even then, the funds would go straight into the Public Defender’s office budget, which a constitutional provision preventing it from going anywhere else or being used to otherwise reduce its normal budget allocation. (Yeah, now I’m really dreaming). And rainbows and unicorns.

        1. SHG Post author

          They will never figure out how to extend their reach. We’re safe. Nothing bad will happen. Right.

        2. DaveL

          A bank card does, and so the cops can’t take anything unless you foolishly give them your PIN.

          A take it you use the word “foolishly” because there are no such adverbs as “under-threat-of-life-plus-cancer-ishly” or “semi-consciously-wheezing-through-broken-teeth-ishly”.

        3. Levi

          It also talks about gift cards, and since they couldn’t as a third party set up an account to process against your deferred revenue balance with Chili’s or Walmart, what they mean is prepaid cards branded as Visa or MasterCard, etc. Note that many payroll departments are moving to process payroll funds to a prepaid V/MC as a cost saving measure for people who choose not do direct deposit, particularly on employers with large, widespread workforces with relatively low incomes.

          As to your card company refusing to authorize a large transaction, a lot of these rules (and they vary from bank to bank) vary depending on the industry code of the merchant processing the transaction, so if these accounts were set up with the codes for “fines” or “taxes”, it’s more likely that the bank would authorize a large transaction. Furthermore, banks are generally more likely to authorize transactions on prepaid cards.

          It’s been a while since I was in the payments business, but the only slightly-less-dark lining to this is that the fight to get the money back would largely occur under the rules of the payment method used (Visa rules, MC rules, etc), which tend to lean in favor of the cardholder. But if, as seems likely, the police seize the card itself and you never thought to write down the card number or the phone number for the bank, on a gift card? You can’t dispute it if you don’t know who to call, and apathy has the same sort of effect as it would for money seized in some remote jurisdiction.

        4. mephistophocles

          That isn’t true. Any bank debit card can also be run as a credit card; no pin required. If the cop has the card in hand, he can even use the 3-digit CVV number on the back to “verify” the “purchase” which in card lingo means it proves the card was present at the point of the transaction, which adds “legitimacy” to the “purchase” (all that means you’re not gonna get your money back).

          Now, all that said, it would be interesting to test the possibility of a chargeback on this. Most banks will return money for any transaction you made if you swear it wasn’t you that made the transaction, or it was made without your consent (which in this case it definitely would be). The “merchant” is then out the money, unless they can prove they did in fact have your consent (which is extremely hard for any merchant to do, and banks almost always side with the cardowner by default anyway).

          [Ed. Note: No real email, no more comments. You’re not special, and don’t give a shit that you fear I might sell your email for spam. Then don’t comment.]

    2. Patrick Maupin

      The prepaid unbanked are, of course, going to be screwed. Perhaps debit card users as well — not using credit is obviously un-American.

      As for credit card users, the “What’s in your wallet?” folks have every incentive to fight this tooth and nail, to have one more reason why credit cards are king.

      But the elephant in the room is smartphone point-of-sale, especially if people get serious about phone security. This might be secure enough to force the cop to forego the financial mayhem and settle for physical violence.

      Expect some enterprising point-of-sale app maket to automagiclly record and store the three minutes of audio and video immediately preceding every transaction.

      1. SHG Post author

        Enterprising folks will figure out all the permutations of asset collection for forfeiture. Don’t worry your pretty head about it. The terrorists will not win!!!

        1. Keith

          Speaking of terrorists, will traveling with an ATM card attached to a bank account with more than $10k in it now be grounds for arrest and seizure at the border? The Feds won’t want to be losing out to some yokel cops in Oklahoma.

          1. SHG Post author

            Once the wall between cash on hand and other assets is broken, the sky’s the limit. That’s what people don’t appear to recognize, but for those of us who have been dealing with this for the past 35+ years have seen, this slope is so slippery that there’s no stopping it once they get up a head of steam.

        2. Patrick Maupin

          The terrorist excuse does sound a bit better than “While we’re waiting for the drug dog to come sniff your asshole so we can start the real fun, we’re going to engage in a bit of wallet-rape foreplay.”

  2. Dale Savage

    I am so disgusted by this practice, thanks for shedding light on it. I can only imagine that this will change when some poor policy maker’s wife or kid is subject to this and then they will realize how much it sucks to be in this position. John Oliver did a great story on civil forfeiture as well as the Washington Post.

    1. SHG Post author

      Is there a reason why you feel entitled to use the comments on my blawg to note that John Oliver and WaPo have also addressed the generic topic of civil forfeiture? So have many others, and if I wanted to include them in my post, I would have. I didn’t, because they aren’t relevant to the particular issue raised in this post. Control your impulse.

          1. JBD

            Oh, give him a break. This is a guy who feels the need to specify on his website that he’s “tried more than twenty (20) felony jury trials” (parenthetical number in original) (don’t know why that’s necessary). He also eschews the use of hyphens (“high profile cases,” “invitation only organization)”.

  3. GreenTriumph1

    I wonder if ERAD can read the new chip enabled credit cards as well as the magnetic strips. At least this would give a temporary reprieve. I have to read more about the history of civil forfeiture and how it got on the books.

    1. SHG Post author

      I have to read more about the history of civil forfeiture and how it got on the books.

      It might have been a bit more effective for you to click on the links in the post rather than announce your ignorance. It’s not just that no one gives a fuck that you know nothing, but compounding your need to announce it by your failure to make the slightest effort to learn about it suggests that your existence defies Darwinism. Why do you hate Darwin so much?

      1. GreenTriumph1

        What an ugly think to say. Does this mean we’re not friends? If we weren’t friends I don’t thing that I could go on.

          1. Wiglaf

            “I invite thoughtful comments, but please keep it civil and respectful. There are rules here.”

            LOL. I guess you can break the rules if you make ’em. Kind of like the government.

            1. SHG Post author

              I expect civility from you, but that does not mean I will respond in kind. This is my home and I make the rules. If you don’t like my rules, then don’t comment.

              Being a moron and an asshole is no way to go through life.

      2. losingtrader

        It’s not just that no one gives a fuck that you know nothing, but compounding your need to announce it by your failure to make the slightest effort to learn about it suggests that your existence defies Darwinism. Why do you hate Darwin so much?

        Oh, #50 for sure. How you chose between a new SHGism and the old link to “let me google that for you,” is irrelevant, but your audience thanks their lucky stars you did.

        1. GreenTriumph1

          Careful! I have filled out my Butt hurt Report Form. Look for it … I am about to post my 6000 word rebuttal.

  4. Weebs

    “If you can prove can prove that you have a legitimate reason to have that money…”

    Sweet Mother of all that is Holy, that is one frightening sentence.

    There are countless reasons someone would have money, none of which are the business of a cop on some Oklahoma roadside.

  5. John Barleycorn

    This cracks me up.

    I bet you can’t even pay your traffic fines at an Oaklomaha county court clerk’s window with plastic and if you can, I bet they pass on the “fee” the plastic providers charge.

    And here they appear to be biting the
    7.7 %. They ought to fix that and send a bill for the 7.7% after they take your life savings and when you can’t pay have a judge put out a warrant for your arrest.

    P.S. Seeing as how you CDLs are so underpaid, your guild should really  consider opening up some regional “banks”*. You could issue savings pass books, like in the good old days,  and whenever one needed some cash to pay the dentist for a root canal or what have you you could swing by a lawyers office who was in the “system” and he or she  could print you up a debit card with some legal script on the chip.

    Oh, never mind I guess that other post you put up today might get in the way of the guild protecting grandma’s pension afterall.

    But then again…

    * Or at the very least get in on the physical gift card racket. “Criminals” are always losing their shit. Hell, I bet you would end up paying out less than 80% of the value of the gift cards issued.

  6. Scott Jacobs

    No, there is no rationale to explain why ERAD Group should get a cut of the vig.

    I’m going to guess it gets marked as a processing fee or something.

    My first question about that 7.7% is: If (big if, because I can read and have basic pattern recognition skills) the money that is seized gets returned, does that mean the money is returned MINUS the 7.7%, does the money get returned with the department and/or state covering that 7.7%, or does it all get returned with ERAD Group refunding the 7.7% while the state returns the 92.3% they kept?

    1. Jim Tyre

      Links are your friend. There’s a link to the contract at the link to the article Scott links in his update. The 7.7% is only for the amount set out in a final, non-appealable forfeiture order.

      I feel so much better now. Don’t you?

      1. SHG Post author

        My experience with forfeiture orders is they can prove to be final and non-appealable, but mysteriously never served on the claimant. Eventually the claimant asks what happened to his loot, and is told the case is done and he lost. He cries sad tears, gets a lawyer, and sometimes the order isn’t final and non-appealable anymore. Go figure.

  7. dempsey

    I practice criminal defense law in Oklahoma and have for 46 years. NOW, the cops have the power to scan my BANK CARD for whatever goofy reason they want. My bank card is linked directly to my bank and my passwords and etc are “saved”, which means when you log-in you are a few clicks away from all my financial information. If I am stopped I am going to assert my 5th amendment rights, not to incriminate myself and if I get arrested, so be it and so-sorry for the cops. This is an absolute Policing for Profit (7.7%) and I for one will not stand for this shit. Its bad enough that we have to put up with the forfeiture crap and now our esteemed legislature has given the cops the ability to get into my financial life….no way will I comply with that request/demand/order from the cops. Fortunately I know a lot of bondsmen and criminal defense attorneys and I won’t be in the joint long, just long enough to file a 1983 for the humiliation of exercising my constitutional rights. By the way, I am confused about which bathroom I can use to take a pee in, after the Legislature fiddled with transgender situation. What the hell is going on in our legislator’s minds?

    1. SHG Post author

      They don’t need to arrest you. That takes work, filling out forms and all. Why bother when they already have your card?

  8. MelK

    From the article: Although the device does not allow funds from non-prepaid cards to be frozen or seized, it can provide the officer information about those cards such as the card number, the name on the card, expiration date and the card issuer.

    Unless you know something you didn’t link to, your prepaid cards and gift cards are toast, but your bank card and credit card information will be seized, but not drained (by the ERAD reader). IMO, that part simply gives the cops a leg up on seizing your accounts the old fashioned way, in that they don’t have to go asking about for where your accounts are.

    The bit I loved from the article was: “The device logs which trooper is using the device when a card is swiped.” … as if records in police custody have never been “lost” due to accident, convenient destruction policy, or “technical issues”.

  9. Pingback: Frontiers of forfeiture: emptying pre-paid bank cards - Overlawyered

  10. jim

    Its official , the cops are officially highwaymen
    if anyone else did this it would be robbery
    Why not just strong arm everyone for a toke
    for crimes to be committed in the future
    Here is your future fine

  11. jim

    Erad Group Inc. is a small, fairly new home business in North Richland Hills, TX. It opened its doors in 2014 and now has an estimated $100,000 in yearly revenue and 1 employee
    Tell Thomas Williams you are not happy – this is where the 7.7% is going

    1. Patrick Maupin

      Meh. Maybe it takes real talent to come up with the next anti-social Great Idea. But it certainly doesn’t take all that much talent to replicate it. Sanford Wallace is going to jail soon, if he’s not already there, but I don’t expect any huge improvement in the quality of my inbox.

Comments are closed.