FBI Ignored Its Own Warrant And Search Policies To Seize Millions From People's Safety Deposit Boxes
from the [hangs-GONE-FISHIN'-sign-in-FBI-office-window] dept
This brief clip from an FBI training film helps explain the actions undertaken by agents during a raid on a secure storage facility earlier this year:
In March of this year, the US Attorney in Los Angeles, California secured an indictment against a secure vault company, alleging the company was engaged in money laundering, drug trafficking, and hiding taxable assets. None of the company's employees or owners were indicted.
FBI agents spent five days turning US Private Vaults upside down. Agents apparently emptied every safety deposit box housed by the business. They did this in complete contradiction of the limits imposed on them by the FBI's own warrant affidavit. Here's Eric Boehm of Reason with some background:
[T]he unsealed warrant authorizing the raid of U.S. Private Vaults granted the FBI permission to seize only the business's computers, money counters, security cameras, and large steel frames that effectively act as bookshelves for the boxes themselves. Per FBI rules, however, the boxes could not be left unsecured in the vault after the raid had been completed, so agents had to take them into custody too.
The FBI could have taken custody of the boxes without opening them and sought warrants for those implicated by the investigation. Instead, the FBI agents emptied the boxes while still on the premises, engaging in dozens of searches not authorized by any warrant.
Here's what the FBI said it would do in its warrant request:
If you can't see the picture, the relevant part of the sworn statement says:
This warrant does not authorize a criminal search or seizure of the safety deposit boxes. In seizing the nests of safety deposit boxes, agents shall follow their written inventory policies to protect their agencies and the contents of the boxes. Also in accordance with their written policies, agents shall inspect the contents of the boxes in an effort to identify their owners in order to notify them so that they can claim their property.
And the agents weren't supposed to empty the boxes and catalog the contents. This is spelled out explicitly in the FBI written policies.
The inspection should extend no further than necessary to determine ownership.
So, permission was given to look in the boxes for anything that might identify the owners so they could come get their stuff from the FBI. But instead of doing that, agents took everything from the boxes and started forfeiture proceedings -- all without determining who owned what or providing any evidence at all that the items found in the nearly 1,000 boxes were obtained illicitly. Indeed, no customers of US Private Vaults have been accused of any criminal activity.
Here's what's happening now, in apparent direct contradiction of the search warrant's limits and the FBI's own policies.
[T]he FBI is now trying to confiscate $86 million in cash and millions of dollars more in jewelry and other valuables that agents found in 369 of the boxes.
Prosecutors claim the forfeiture is justified because the unnamed box holders were engaged in criminal activity. They have disclosed no evidence to support the allegation.
[...]
Beyond the $86 million in cash, the FBI is seeking to confiscate thousands of gold and silver bars, Patek Philippe and Rolex watches, and gem-studded earrings, bracelets and necklaces, many of them in felt or velvet pouches. The FBI also wants to take a box holder’s $1.3 million in poker chips from the Aria casino in Las Vegas.
The items the government claims -- without facts in evidence -- are the result of criminal activity includes unemployed food service worker's life savings: $57,000 he obtained from lawsuit settlements stemming from a car accident in which he suffered a spinal injury and a successful claim against a landlord for chronic housing code violations.
Another US Private Vault's customer (being represented, like the man above, by the Institute for Justice) lost her life savings to the FBI's actions, a total of $80,000 that is obviously important to the 80-year-old woman who presumably wasn't participating in drug dealing and money laundering. Contrary to the warrant and FBI guidelines, agents took everything in her safety deposit box even though they found identifying information as soon as they opened the box. Recordings of the raid show an agent holding her ID up to the camera before proceeding to go through the box, opening sealed envelopes and emptying their contents into another container.
It wasn't just cash, coins, and other valuables being seized by agents. The take also included personal items belonging to Paul and Jennifer Snitko. This is what the FBI -- until goaded into being a little less assholish by negative press and a handful of lawsuits -- considered to be evidence of criminal activity.
In the Snitkos' box, along with the baptismal certificate: a pilot's log, heirloom jewelry, collectible coins, a marriage certificate, a birth certificate.
The FBI recently returned these items to the Snitkos, making them one of the lucky few to have their property returned. But those with larger quantities of valuable items or cash are probably going to have to sue to get their items returned. The FBI says it's only willing to return items from about a quarter of the boxes its agents searched and seized without a warrant.
The FBI has returned the contents of about 75 boxes and plans to give back the items found in at least 175 more, because there was no evidence of criminality, Mrozek said. Federal agents have not determined who owns what was stored in many other boxes.
That's the latest from Thomas Mrozek, the spokesperson for the Los Angeles US Attorney's office. The FBI and federal prosecutors are hoping to take ownership of as much as possible from the remaining boxes, all of which is detailed in the very long inventory list compiled by the agents who performed the raid.
This is extremely ugly. Unfortunately, the use of civil forfeiture shifts some of the burden to those whose assets were seized. The government doesn't really have to do anything. If claimants don't come forward before June 24, those unclaimed assets will become government property, whether or not they had anything to do with criminal activity.
Those that do file a claim will have to deal with a convoluted and expensive process that helps ensure the government will still get to keep most of what it seized under the guise of performing an inventory. The burden of proof for the government is extremely low. And it's apparently telling judges a dog gave agents permission to engage in a bunch of warrantless seizures.
Drug-sniffing dogs at the store during the raid alerted to traces of drugs on most of the money found in boxes, FBI agent Justin Palmerton claimed in a court statement. The boxes containing that cash are subject to criminal investigation, he said.
This claim is stupid as fuck and hopefully won't be given any respect from judges that are subjected to it. Most currency contains trace amounts of drugs. That's common knowledge. But the FBI isn't raiding banks just because a dog alerted near the ATM. This is a completely disingenuous claim and, by itself, isn't evidence of anything more than the FBI's willingness to use literally anything to justify its warrantless acquisition of other people's property.
Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.
While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.
–The Techdirt Team
Filed Under: 4th amendment, asset forfeiture, asset seizure, civil asset forfeiture, doj, fbi
Companies: us private vaults
Reader Comments
Subscribe: RSS
View by: Time | Thread
How were people whose property was seized meant to know about the seizure if the FBI did not notify them, and the raid was not widely publicised? Its going to be hard luck if any of those boxes were storage while the owner spends months out of the country.
[ link to this | view in chronology ]
Re:
"How were people whose property was seized meant to know about the seizure if the FBI did not notify them..."
They weren't meant to know...
[ link to this | view in chronology ]
If only people had rights that actually meant bad things would happen to those who violate them.
[ link to this | view in chronology ]
"warrantless acquisition of other people's property."
Better known as theft.
[ link to this | view in chronology ]
Re:
And it doesn't violate the 4th Amendment because...the judge waves his hands ... Magic!
[ link to this | view in chronology ]
Re: Re:
According to the govt, it's not a violation of the 4th Amendment because it's the property that's accused of the crime, not the property's owner, and property doesn't have any rights. Why it doesn't violate the 5th Amendment's "nor be deprived of .. property without due process of law" I don't know.
[ link to this | view in chronology ]
Re: Re: Re:
Well, we should let the FBI know that Trump's home has committed a crime.
[ link to this | view in chronology ]
Re: Re: Re:
Given that it's the property that is accused of the crime, I'm wondering where the jury by its peers (article III, section 2) went to.
[ link to this | view in chronology ]
Re: Re: Re: Re:
A jewelry store?
[ link to this | view in chronology ]
The only truly secure security box seems to be a very deep hole in the middle of bum fuck no where
[ link to this | view in chronology ]
I’d just like to say “bravo” on the GIF usage here. 😁
[ link to this | view in chronology ]
The FBI, protecting ameria one robbed person at a time
Whew, I am so very glad that the FBI is working overtime in order to protect the american public, I mean just imagine how many criminals would be running around robbing people blind if the FBI wasn't on the case and getting to the money and valuables first.
[ link to this | view in chronology ]
If the vault wasn't FDIC insured: then robbing them is probably even better than robbing a bank
[ link to this | view in chronology ]
Re:
just realize I probably should have added either "to the FBI" or '/s'
imagine which ever one you like
[ link to this | view in chronology ]
Here’s hoping Aria doesn’t recognize the claim when the Feds try to cash in the chips
[ link to this | view in chronology ]
Question: what happened to the vault company's record books showing the ownership of each box?
[ link to this | view in chronology ]
Re:
They were meant to be kept hidden, presumably "for security purposes", until after June 24th.
I'd like to think that any judge would see this for the sham it is, and order the return of all assets, period. But my dream world is a reality unto itself, so....
[ link to this | view in chronology ]
Re: Re:
What makes us think they can return all the property to their owners, when the Federal government can't even find the children they took from their undocumented parents? This is the feature not a bug.
[ link to this | view in chronology ]
Re: Re:
Me too!!!!! I pray each and every day and also cry each and every day!!!!
[ link to this | view in chronology ]
seize the business's computers
This warrant does not authorize a criminal search or seizure of the safety deposit boxes. In seizing the nests of safety deposit boxes, agents shall follow their written inventory policies to protect their agencies and the contents of the boxes. Also in accordance with their written policies, agents shall inspect the contents of the boxes in an effort to identify their owners in order to notify them so that they can claim their property.
Federal agents have not determined who owns what was stored in many other boxes.
What?
[ link to this | view in chronology ]
Thinking on this some more....
It seems to me that the FBI didn't rob just the individual box holders, they also robbed the company providing the service. Unless the contract for services was written with some very fine print, then they quite likely are on the hook to reimburse those folks. Very sadly for USPV, if they had insurance (and they were probably required to by law), they're not going to be happy - it's a de facto standard of the insurance industry that no "authorized legal activity" is insurable, full stop.
Oh my, I think the courts are going to see all kinds of action in the near future. Could be time to re-stock my pile of Amish popcorn.
[ link to this | view in chronology ]
Re:
However, according to the warrant, the search and seizure of the boxes wasn't authorized. So maybe it'll still be covered?
[ link to this | view in chronology ]
Re: Re:
The way I see it, if the government declares it to be 'authorized', then it is so, and that puts the matter to rest. However, if a judge states otherwise, then indeed the insurance company may be on the hook, and you can be sure that they have enough high-caliber lawyers on call that they can and will rake the government over the coals until well and truly done to a crisp.
Here's a dichotomy for you: suppose a victim actually gets a day in court. I can see an insurance lawyer filing an amicus curiae brief arguing that the government did no wrong. Talk about trying to have your cake and eat it too....
The way I see if, if the government declares it to be 'authorized', then it is so, and that puts the matter to rest. However, if a judge states otherwise, then indeed the insurance commpany may be on the hook, and you can be sure that
they have enough high-caliber lawyers on call that they can and will rake the government over the coals until well and truly done to a crisp.
Here's a dichotomy for you: suppose a victim actually gets a day in court. I can see an insurance lawyer filing an amicus curiae brief arguing that the government did no wrong. Talk about trying to have your cake and eat it too....
[ link to this | view in chronology ]
Re: Re: Re:
Jeez, I don't even understand how that happened! I even checked it with Preview, like I always do.... no sign of doubling up like that. Hope that doesn't start happening any too often.....
[ link to this | view in chronology ]
Re: Re: Re:
As I would be very surprised if the government were honest enough to admit that the FBI stole a bunch of stuff I imagine they will go with an 'authorized even if it might have slightly bent the warrant' angle or something similar, arguing that even if they might have technically made teeny-tiny steps over the warrant's limitations it was all in a good cause so it's still authorized and covered by the warrant.
[ link to this | view in chronology ]
I don't know what the court proceedings for trying to get your stolen property back are like, but what I'd love to see happen;
"Your honor, the government representative claims that because a drug dog alerted to the cash, it's evidence that it was obtained illegally. By that logic, if cash was obtained legally, there should be no trace of drugs on it. I have a licensed drug dog at my disposal, why don't we have it sniff whatever cash the government representative has in his wallet and see if that theory holds up. Surely, all of his cash was legally obtained."
[ link to this | view in chronology ]
Wait a minute...
But they seized the business computers. Don't business computers typically have things like a list of boxes and contact information?
[ link to this | view in chronology ]
Re:
As I find it difficult to imagine that a business like that wouldn't have records stating who owns what box I suspect that clause was merely a way for them to riffle through all the boxes looking for other goodies they might want to steal/use.
[ link to this | view in chronology ]