Police Are Using Prepaid Card Readers to Seize Drug Money

What once was a practice used primarily by the United States government to crack down on international drug traffickers is now being used by local law enforcement agencies in hopes of seizing more money connected to black market drug trade.

A recent report from the Arizona Journal indicates that the Navajo County Sheriff’s Office has been approved to begin using ERAD-Prepaid debit card readers during traffic stops that result in the discovery of illegal drugs. The overall goal, according to Sheriff KC Clark, is to bust people running dope along Interstate 40, while allowing his department to become more profitable from these types of arrests.

While it can be difficult for cartel soldiers and mid-level domestic dope dealers to smuggle large amounts of cash undetected across America, many have caught on to the scheme of putting dirty money on pre-paid credit cards. This makes it easier for drug dealers to skate by the hounds of law enforcement, providing them with a financial invisibility cloak, of sorts, which has the potential to protect them from relinquishing substantial quantities of cash in the event of a roadside shakedown. It is also a lot less suspicious than carrying around stacks of paper currency.

Several years ago, however, a proposed amendment to the Bank Secrecy Act, Financial Crimes Enforcement Network (FinCen), sought to cripple this modern method of money laundering by suggesting that the Department of Homeland Security require travelers, specifically in the case of international passages, to declare the amounts on their prepaid credit cards. The supposed objective of this amendment was to create a modernized extension of policies pertaining to the declaration of checks, money orders, and travelers checks.

In 2012, a letter by FinCen director James H. Freis, Jr. revealed the agency had already been working to develop a handheld device that would quickly differentiate between bank issued credit cards and those of the prepaid variety. This technology would allow international travelers to be scanned for “stored value cards” containing more than $10,000.

Prepaid credit card scanners allow law enforcement agencies to determine how much money is on card, while also giving them the power to freeze and seize those funds based on the civil asset forfeiture law. And no conviction is necessary for the police to keep this money.

Although there has not been much of a controversial buzz surrounding this newfound drug war tactic since it was revealed in 2012, the latest report from the Journal is a relatively good sign that card readers are beginning to trickle further into state territories. The Navajo County Sheriff’s Department, which polices a population of around 100,000, claims the devices will only be used in situations where illegal drugs are found, and not against the “average citizen” during routine traffic stops.

There are some concerns, however, that police will use these prepaid credit card scanners to steal funds from citizens caught in possession of marijuana. A large percentage of the population, which do not have the means to get a bank account, rely on prepaid services to conduct their day-to-day business. Taking this into account, it is conceivable that an otherwise innocent person could be busted for a single joint, and subsequently left without a dime to their name.

“We know that many students, immigrants and unbanked persons use and rely on prepared cards as their primary means of making payments and managing their finances,” said Judith Rinearson, an attorney who represents the prepaid card industry. “Why should they be singled out and treated disparately from users of other payment products? Why should law enforcement have access to their account balances without a subpoena or other due process?”

It is difficult to say whether other local and state police agencies are employing the use of prepaid credit card readers as a means to generate additional revenue through seizure programs. When High Times contacted a veteran officer with the Indiana State Police earlier this morning, he said he was not aware of the department utilizing this technology.

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