Judge Blocks FBI From Moving Forward With Forfeitures Of Property Seized In US Private Vaults Raid

from the get-your-shit-together,-g-men dept

Earlier this year, the FBI raided a privately owned safety deposit box business in Los Angeles. The business provided secure storage for customers' valuables, which were only accessible via biometric scans. The DOJ accused the company of engaging in drug trafficking and money laundering, but has yet to bring charges against any of the company's employees or its customers.

The FBI obtained a search warrant that limited agents to seizing items belonging to the company but, very expressly, not items belonging to customers. This restriction -- and the FBI's own inventory policy -- was ignored. Over the course of five days, FBI agents searched and seized the contents of nearly 1,000 boxes.

The warrant said the FBI would understandably take temporary possession of the boxes. But it forbade them from searching them for criminal evidence. The FBI's policy limited its inventory of the boxes' contents to doing only what was necessary to find information about the property's owner so they could be notified and allowed to retrieve their contents.

This didn't happen. The FBI walked away with millions of dollars and -- months after the seizures -- has yet to accuse any customer of criminal activity. Several customers sued. And a federal judge has just blocked the FBI from taking possession (via civil asset forfeiture) of some of the property seized in the raid.

In a 7-page ruling Tuesday, [Judge R. Gary] Klausner sided with plaintiffs and granted the temporary restraining order preventing the government from forfeiting Jeni, Michael, Joseph and Travis’ property.

To satisfy due process, the government must provide property owners notice of the statutes buttressing forfeiture proceedings, the ruling said, adding that the notices sent to plaintiffs failed to do so.

“The notices therefore fall woefully short of the government’s duty to provide ‘the specific statutory provision allegedly violated,’” Klausner wrote in the order.

As the judge's order [PDF] points out, the law requires specificity when notifying citizens of the government's desire to forcibly transfer ownership. The notices sent by the FBI weren't specific.

Rather than list the specific statutory provisions the Government maintains justify forfeiture of the specific property seized from each USPV box, the Government notices state:

Forfeiture Authority: The forfeiture of this property has been initiated pursuant to 18 USC 981(a)(1)(C) [sic.] and the following additional federal laws: 19 USC 1602-1619, 18 USC 983 and 28 CFR Parts 8 and 9.

The list of purported statutory bases for forfeiture is anything but specific. Title 18 USC 981(a)(1)(C) lists thirty-five sections of the United States Code. A violation of any one of those code provisions can provide a basis for forfeiture… These include code sections outlawing influencing a loan officer, forgery, counterfeiting, uttering counterfeit obligations, smuggling, loan fraud, computer fraud, and bank fraud, among others.

No specificity, no seizure. The FBI is blocked from moving forward with forfeiture belonging to the four plaintiffs until it can provide them with the proper notice -- one that specifies what criminal activity the government believes the seized property is linked to or the result of.

Given the total of the take from US Private Vaults raid, I would expect the government to give up this property rather than head into some litigation that may result in similar lawsuits or court orders affecting the dispensation of other seizures/searches that haven't been challenged yet. This could have been avoided if the government had followed its own warrant restrictions, its own internal policies, and the contours of the rights enshrined in the Constitution.

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Filed Under: 4th amendment, civil asset forfeiture, civil asset seizure, doj, fbi, safety deposit box, seizure


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  • icon
    That One Guy (profile), 6 Jul 2021 @ 3:50pm

    That didn't take long

    From 'We pinky-promise to only search company property' to '... Well while we're here might as well browse through the rest of these boxes' and finally landing on '... Since we already have the stuff we'll just keep it' they went from pretending this was about catching criminals to showing those crooks how it's done lightning fast.

    The FBI's eagerness to engage in mass robbery aside this really shouldn't be something that a judge needs to weigh in on, the fact that the original warrant and FBI policy didn't cover stealing anything not nailed down should be all that's required to spike any attempt by the FBI to get away with their stolen goods so the fact that several of the victims had to go to court to prevent that is all sorts of messed up.

    reply to this | link to this | view in chronology ]

    • icon
      Upstream (profile), 6 Jul 2021 @ 4:27pm

      Re: That didn't take long

      No, it did not take the FBI long at all to s̶e̶i̶z̶e̶ steal the property, but the legal system sure took it's sweet time registering it's disapproval. The s̶e̶i̶z̶u̶r̶e̶ theft took place "on or around" March 22, and the ruling is dated June 22. Three months to state the obvious might seem quick to those in the legal system, but to those of us in the real world it seems painfully slow, maybe even intentionally slow, so as to give the FBI plenty of time to CYA or "misplace" the loot.

      reply to this | link to this | view in chronology ]

      • icon
        That One Guy (profile), 6 Jul 2021 @ 4:59pm

        Re: Re: That didn't take long

        It's possible that the ruling itself was relatively quick and the long time difference between the robbery and it was due not the judge taking a long time but the FBI only informing people that they'd be stealing their stuff for good much later, whether because they just couldn't be bothered or in an attempt to give the victims a short window of time in which to file legal challenges.

        reply to this | link to this | view in chronology ]

      • icon
        sumgai (profile), 6 Jul 2021 @ 6:42pm

        Re: Re: That didn't take long

        (off topic)

        OK, how did you get those strike-through's to show up?

        reply to this | link to this | view in chronology ]

        • identicon
          Rocky, 6 Jul 2021 @ 7:54pm

          Re: Re: Re: That didn't take long

          I̶t̶'̶s̶ ̶a̶ ̶s̶e̶c̶r̶e̶t̶... Seriously though, it's just a creative use of unicode-characters. ˙ʇuɐʍ noʎ ɟı sıɥʇ op uǝʌǝ uɐɔ no⅄

          Just google "unicode strikethrough".

          reply to this | link to this | view in chronology ]

          • icon
            sumgai (profile), 7 Jul 2021 @ 1:05am

            Re: Re: Re: Re: That didn't take long

            Thanks!

            I've been able to write upside down for some time, but got out of the habit. I admit, doing a strikethrough with Unicode just never occurred to me.

            reply to this | link to this | view in chronology ]

      • icon
        Uriel-238 (profile), 6 Jul 2021 @ 9:27pm

        Misplacing the loot

        The assets were taken by agents of the federal government. Wouldn't then the United States of American be responsible for restoring those assets to their rightful owners (or compensating them appropriately)?

        Somehow I suspect any legal rulings that might say it isn't would conflict not only with the Fourth Amendment, but also the notion of government by consent. At that point we might as well say we peons and all our stuff are owned by our aristocratic masters.

        I've got popcorn, though. This ought to be good.

        reply to this | link to this | view in chronology ]

      • identicon
        Anon, 7 Jul 2021 @ 11:02pm

        Re: Re: That didn't take long

        Yes, this was remarkable - I'm surprised a case went from filing to judgement in only 3 months. I guess the FBI hires civil-service level lawyers, who don't always know how to stall, stall stall and rack up billable hours for the plaintiffs so that it cost more to fight than the stolen goods are worth.

        reply to this | link to this | view in chronology ]

  • icon
    Toom1275 (profile), 6 Jul 2021 @ 4:45pm

    one that specifies what criminal activity the government believes the seized property is linked to or the result of.

    Theft by FBI agents.

    There, box filled.

    reply to this | link to this | view in chronology ]

  • icon
    rw (profile), 6 Jul 2021 @ 4:51pm

    The very best thieves appear to be in law enforcement.

    reply to this | link to this | view in chronology ]

    • icon
      That One Guy (profile), 6 Jul 2021 @ 4:55pm

      Re:

      As I've noted a number of times stupid criminals end up in a cell, smart criminals get a badge and never have to worry about that possibility.

      reply to this | link to this | view in chronology ]

  • identicon
    Pixelation, 6 Jul 2021 @ 6:00pm

    "... only accessible via biometric scans"

    If the contents of the boxes are only accessible via biometric scans, how did the FBI get access?

    reply to this | link to this | view in chronology ]

  • icon
    That Anonymous Coward (profile), 6 Jul 2021 @ 6:52pm

    Gangs with badges.

    reply to this | link to this | view in chronology ]

    • icon
      P.C. (profile), 7 Jul 2021 @ 2:21am

      Re:

      In 3rd-world countries, citizens refer to their police as “thieves in uniforms”. USA has been and will continue to move in that direction unless all seizures and forfeitures go directly to the IRS.

      reply to this | link to this | view in chronology ]

      • icon
        Upstream (profile), 7 Jul 2021 @ 2:48am

        Re: Re:

        In 3rd-world countries, citizens refer to their police as “thieves in uniforms”. USA has been and will continue to move in that direction u̶n̶l̶e̶s̶s̶ even if all seizures and forfeitures go directly to the I̶R̶S̶ thieves' bosses.

        FTFY

        reply to this | link to this | view in chronology ]

      • icon
        MikeVx (profile), 7 Jul 2021 @ 7:00am

        Re: Seizures go to the IRS.

        As long as seizures can be kept by any part of the government, the corruption will continue. Allow seizures to go to the IRS and deals will be struck to get money back to seizing agencies. Seizure money that does not end up being returned should be required to be donated to IRS-recognized charities. The selection of charity should be by a panel of persons who have had assets seized. This will assure that the money goes to the charities most offensive to the government.

        If seizure is legitimately for controlling crime, little will change in seizures. If it is for profit, this should cause seizures to all but vanish.

        Under no circumstances should government be allowed to keep seized assets. The same should apply to any government-imposed penalty. Any time governments are allowed to keep money/assets taken for citizen misbehavior, corruption will develop, if it was not the reason for the penalty to begin with.

        reply to this | link to this | view in chronology ]

  • icon
    That Anonymous Coward (profile), 7 Jul 2021 @ 3:00am

    "This could have been avoided if the government had followed its own warrant restrictions, its own internal policies, and the contours of the rights enshrined in the Constitution."

    Remember when violating someones Constitution rights actually got people fired & ended careers?

    Oh my bad, I looks like Beverly Hills is in the 100 Mile Constitution Free Zone. Carry on robbing people you find there, they aren't actually citizens... citizens have rights.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 7 Jul 2021 @ 4:40am

    If cops could feel guilt or shame you'd think they'd be embarrassed that the courts treat them like small children.

    Judge: "Okay I'm going to count to three and when I get there you better not be violating the Constitution, law, and department policy anymore.
    1....2...2 1/2...2 5/8...2 3/4....alright seriously guys...2.9...2.91..2.92...2.93...2.94...2.95....2.96....2.97...2.98....2.99....2.999....2.9999...las t warning...2.9999999....2.999999999999....court is now adjourned for juice boxes, graham crackers, and nap time for our boys in blue."

    reply to this | link to this | view in chronology ]

    • identicon
      David, 7 Jul 2021 @ 8:55am

      Re:

      court is now adjourned for juice boxes, graham crackers, and nap time for our boys in blue."

      I think you misspelt "nab time".

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 7 Jul 2021 @ 11:23am

    FBI: oooh, yummy free lootboxes. 5.....4....3...2..1. Looted.

    https://en.wikipedia.org/wiki/Loot_box

    reply to this | link to this | view in chronology ]

  • identicon
    Rekrul, 7 Jul 2021 @ 5:33pm

    No specificity, no seizure. The FBI is blocked from moving forward with forfeiture belonging to the four plaintiffs until it can provide them with the proper notice -- one that specifies what criminal activity the government believes the seized property is linked to or the result of.

    "This seized property was paid in compensation for plaintiffs illegally stealing government property from the moon."

    Seriously, it's not like the supposed crime matters to the forfeiture process. They usually just pull something out of their ass anyway, completely unsupported by any evidence, so what does it matter what crime they list?

    reply to this | link to this | view in chronology ]


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