The FBI is being sued after seizing the contents of safe deposit boxes and allegedly failing to return all of what it seized.
Donald Mellein was storing 110 gold coins in one of the boxes. The FBI initially said it did not have the coins, but Mr. Mellein's legal action resulted in the agency acknowledging it did have 47 of them.
The FBI returned the coins but still has not given back the other 63, which are worth an estimated $123,419, according to one of the new 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 were storing silver and cash in another one of the boxes. The FBI tried keeping the items, but eventually gave up. Agents returned the $20,000 in silver, but held on to $2,000 in cash, according to another suit.
In both cases, the FBI has denied responsibility, stating there was “no evidence of negligence or wrongful acts on the part of any FBI employee.”
"Jeni and Michael are entitled to have their cash returned, or to be reimbursed for its loss, regardless of whether they can prove that some FBI employee did something wrong or was negligent. Whatever the reason for the cash disappearing, the government is responsible for either returning the cash to Jeni and Michael or compensating them for what it took," the other suit states.
The FBI said it cannot comment on pending litigation. It pointed to a previous statement on a ruling that found agents investigating U.S. Private Vaults did not mislead the court.
Lawyers at the Institute of Justice, which are representing the plaintiffs, are asking the court to award damages to the plaintiffs and declare federal law unconstitutional as applied by the FBI in the raids.
“If normal people are held accountable for stealing or losing your property, then the government should be, too,” Joe Gay, an attorney at the institute, said in a statement. “Don, Jeni, and Michael did nothing wrong. The government never should have broken into their safe-deposit boxes, but once it did, it became responsible for keeping their property safe. If it doesn’t give it back, there must be a legal remedy.”
The FBI obtained warrants to search U.S. Private Vaults, which held more than 1,000 safe deposit boxes in Beverly Hills, and served them on March 22, 2021. The FBI said there was reason to believe the business had committed crimes.
In warrant applications, FBI officials said they would "end up with custody" of the safe deposit boxes and the contents of the boxes. Officials promised the FBI would protect the contents and return them to their owners. The warrant allowed agents to perform an inventory of the boxes to "protect their agencies and the contents of the boxes" and directed agents to identify owners so the property could be returned.
During depositions, though, one of the FBI officials has said the government planned to try to keep some of the contents that were worth at least $5,000. The FBI worked to find evidence that would support keeping the contents, such as evidence that money "smelled like drugs."
FBI official Lynne Zellhart, the official, acknowledged that no video recordings existed of when agents broke into some of the boxes. "Reality got in the way," she testified.
Detailed inventories of the boxes were also not created. One agent said the operation was aimed at "processing boxes quickly." Vague terms like "miscellaneous general items" were used in a number of instances. Inventory forms for Mr. Mellein's box did not refer to the 110 gold coins, according to the suit.
Mr. Mellein applied to get his property back and soon received a notice of forfeiture proceedings that outlined how the government was working to keep cash and a gold bar that was also in his box. His lawyers convinced the FBI to abandon the effort, and the agency returned the cash and gold bar.
Attempts to secure the coins were not fruitful, prompting a lawsuit. The government then said it had "found" 47 coins, but could not locate the other coins. Mr. Mellein withdrew his suit and filed 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 they kept in the box.
Mr. Mellein said in a statement: “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. I’m disappointed that I have to sue again in order to get property back that should have been given back to me over two years ago.”
Ms. Pearsons added: "We’re fighting for our money, but also to hold the government accountable when it takes people’s property and then steals or loses it.”