Busted! Wilmington Agrees To Overhaul Its Predatory Impound Scheme Busted!

Ordinarily, when a city contracts government services to private companies, it pays them. But the city of Wilmington, Delaware, thought it came up with a clever way to avoid paying tow companies for their services: Rather than offer money, why not let the companies keep the cars they seize? Then, by devising a predatory impound scheme that ensures people can’t get their cars back, the city could get all the towing services it needed—without paying a penny!

In 2021, Ameera Shaheed and Earl Dickerson—Wilmington residents who lost their cars to this “government theft auto” racket—partnered with IJ to end it. After four years of litigation, the city backed down. It agreed to compensate Ameera and Earl and reform its impound procedures.

Here’s how the scheme operated. A private towing company would offer its services to the city at zero cost. In exchange, the company could tow any legally parked car with at least $200 in unpaid parking fines without any advance notice or hearing. From there, a car owner had just 30 days to pay every penny of the parking tickets, towing fees, storage fees, and other fines. There was no opportunity for a hearing before this ransom payment. If the owner failed to come up with the money, the towing company kept the car. Worst of all, the owner still owed the parking ticket debt—meaning her next car could be impounded, too.

After IJ scored a preliminary win in trial court, the city finally agreed to work with us to overhaul its impoundment practices in line with the U.S. Constitution—including multiple violation notices, accessible payment plans, and expedited hearings. And most importantly, if a car is ultimately scrapped or sold, the owner’s remaining tickets and fees are dismissed. Once predatory, Wilmington’s impound system now serves as a model for cities nationwide.

Similar IJ cases continue in Chicago, Detroit, and Brookside, Alabama. Though the details of each city’s scheme may vary, each case advances the same principle we vindicated in Wilmington: Government (and its private contractors) cannot take property without a good reason and without procedural protections demanded by the Constitution.

Will Aronin is an IJ senior attorney.