FBI sued for losing seized rare coins in raid.
The FBI is facing a lawsuit after seizing the contents of safe deposit boxes and allegedly failing to return everything it took.
Donald Mellein had 110 gold coins stored in one of the boxes. Initially, the FBI claimed they didn’t have the coins, but Mr. Mellein’s legal action forced them to admit they had 47 of them.
The FBI returned the coins, but they still haven’t returned the remaining 63, which are valued at around $123,419, according to one of the lawsuits.
“Don’s gold coins were completely secure until FBI agents broke open the safe-deposit box looking for property that could be forfeited. Their disappearance can only be explained by the acts or omissions of the FBI agents who broke into the box and rummaged through it. The FBI never should have broken into the safe-deposit boxes in the first place but, once it did, it became responsible for returning everything it had custody of, unless it had a lawful reason to keep it,” the suit, filed in U.S. court in California, states.
Jeni Pearsons and Michael Storc had silver and cash stored in another box. The FBI attempted to keep the items but eventually gave up. They returned the $20,000 in silver but kept $2,000 in cash, according to another lawsuit.
In both cases, the FBI denies any responsibility, claiming there is “no evidence of negligence or wrongful acts on the part of any FBI employee.”
“Jeni and Michael have the right to have their cash returned or be compensated for its loss, regardless of whether they can prove any wrongdoing or negligence by an FBI employee. Regardless of the reason for the cash disappearing, the government is obligated to either return it or provide compensation,” states the other lawsuit.
The FBI has declined to comment on the ongoing litigation, referring to a previous statement regarding a ruling that found no misconduct by agents investigating U.S. Private Vaults.
The plaintiffs, represented by lawyers from the Institute of Justice, are seeking damages and challenging the constitutionality of federal law as applied by the FBI in these raids.
“If regular people are held accountable for stealing or losing your property, then the government should be held accountable too,” said Joe Gay, an attorney at the institute. “Don, Jeni, and Michael did nothing wrong. The government should never have broken into their safe-deposit boxes, but once they did, they became responsible for safeguarding their property. If they refuse to return it, there must be legal consequences.”
More Background
The FBI obtained warrants to search U.S. Private Vaults, a facility in Beverly Hills that housed over 1,000 safe deposit boxes, on March 22, 2021. The FBI suspected the business of criminal activities.
In the warrant applications, FBI officials assured that they would take custody of the safe deposit boxes and their contents, promising to protect and return them to their owners. The warrant authorized agents to inventory the boxes to ensure their safety and identify owners for the return of their property.
However, during depositions, an FBI official revealed that the government intended to keep some contents worth at least $5,000. The FBI sought evidence to support their decision, such as claiming money “smelled like drugs.”
Lynne Zellhart, the FBI official, admitted that there were no video recordings of agents breaking into some of the boxes, stating that “reality got in the way.”
Detailed inventories of the boxes were not properly documented, with agents focused on processing them quickly. Vague descriptions like “miscellaneous general items” were used in several instances. The inventory forms for Mr. Mellein’s box did not mention the 110 gold coins, as stated in the lawsuit.
Mr. Mellein applied to retrieve his property and received a notice of forfeiture proceedings, which outlined the government’s intent to keep his cash and a gold bar found in his box. His lawyers convinced the FBI to abandon this effort, resulting in the return of the cash and gold bar.
However, their attempts to recover the remaining coins were unsuccessful, leading to the filing of a lawsuit. The government then claimed to have “found” 47 coins but could not locate the others. Mr. Mellein withdrew his suit and submitted an administrative claim, which was rejected.
Ms. Pearsons and Mr. Storc went through a similar ordeal. They received their silver back but not the cash stored in the box.
Mr. Mellein expressed his disappointment, stating, “The FBI had no reason to go through my box, and they were careless in losing my savings. For months, I was told they didn’t have any of my coins before they eventually found some of them. It’s frustrating that I have to sue again just to reclaim property that should have been returned to me over two years ago.”
Ms. Pearsons added, “We’re not only fighting for our money but also to hold the government accountable when it seizes and then loses or steals people’s property.”
Lack of accountability regarding seized items raises several questions about their handling of evidence. Some possible questions could be:
BI agent testified that the agency did not have a plan to quickly return the seized items to their owners. It was also revealed that the FBI did not have a system in place to properly track and document the contents of the seized boxes.
This lack of accountability and negligence on the part of the FBI has resulted in numerous individuals losing their valuable possessions, including gold coins, silver, and cash. The FBI’s failure to return these items has caused significant financial and emotional distress for the affected individuals.
The lawsuits filed by Donald Mellein, Jeni Pearsons, Michael Storc, and others against the FBI highlight the agency’s disregard for the rights and property of American citizens. The plaintiffs argue that the FBI had no lawful reason to seize their safe deposit boxes in the first place, and therefore, should be held responsible for returning all the seized items.
The suit filed by Donald Mellein asserts that the FBI agents broke into the safe deposit box without any justification and rifled through its contents. The disappearance of Mellein’s gold coins can only be attributed to the actions or omissions of the FBI agents involved. The suit argues that once the FBI unlawfully entered the safe deposit box, it became responsible for returning everything it had custody of.
Similarly, Jeni Pearsons and Michael Storc’s lawsuit highlights the FBI’s attempted seizure of their silver and cash. While the FBI eventually returned the silver, they kept $2,000 in cash without any legal justification. The suit argues that regardless of the reason for the cash disappearing, the government is obligated to either return it or provide compensation.
The FBI’s
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