Privacy

FBI Seized $900,000 From Safe Deposit Box on 'Pure Conjecture,' Federal Judge Says

Reason has joined a new legal effort seeking to force the government to unseal warrants justifying the FBI's seizure of more than 600 safe deposit boxes.

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A federal judge issued a sharp rebuke to the FBI's attempt to expose the identity of one of the anonymous victims of a March raid that seized more than $86 million in cash, jewelry, and other valuables from safe deposit boxes in Beverly Hills, California. Now a new legal effort is seeking to force the government to explain its own still-secret justification for the raid.

In a ruling issued last week, U.S. District Judge Gary Klausner rejected prosecutors' request to dismiss a lawsuit filed by the owner of Box 904, one of more than 600 safe deposit boxes seized by the FBI during the March 22 raid of U.S. Private Vaults. The box-holder, identified in court documents under the pseudonym "Charles Coe," claims to have lost more than $900,000 in cash and other valuables. In trying to get the lawsuit dismissed, prosecutors also asked Klausner to force Coe to identify himself publicly before returning the seized property.

"If the government believes that plaintiff did not lawfully possess the contents of box number 904, the government can, of course, defend this suit on that basis," Klausner wrote. "But the government has made no showing that plaintiff possessed the items seized from box number 904 unlawfully."

Later, he added that the government's case against Coe has not been based on "anything more than pure conjecture that plaintiff might have unlawfully possessed the items seized from box number 904."

That's been true for much of the government's case against the hundreds of safe deposit boxes seized from U.S. Private Vaults. When the FBI raided the facility on March 22, agents were armed with a warrant that explicitly forbade them from seizing the contents of the safe deposit boxes kept there. But the FBI took them into custody anyway. In May, the FBI filed administrative forfeiture proceedings against 369 of the nearly 800 boxes seized—including more than $85 million in cash and other valuables.

A federal grand jury indicted U.S. Private Vaults on a number of charges, including conspiracy to launder money and sell drugs. Michael Poliak, one of the co-owners of U.S. Private Vaults, has a lengthy criminal history that includes money laundering and may have used "dirty" money to purchase a stake in the company, according to an affidavit filed by an undercover police officer and published earlier this week by The Daily Beast. 

As Reason has previously reported, prosecutors have tried to argue that the alleged misdeeds of the company's owners should turn their customers into suspects, too. In court filings, prosecutors have said "some" of U.S. Private Vaults' customers were "honest citizens," but contended that "the majority of the box-holders are criminals who used USPV's anonymity to hide their ill-gotten wealth."

But all that conjecture, as Klausner noted, has not yet added up to much in the way of actual prosecutions against U.S. Private Vaults' customers who had their valuables swept up in the raid. Poliak is not facing criminal charges either.

Lawyers representing some of the raid's victims say the FBI's sweeping seizure of the safe deposit boxes was a serious violation of the Fourth Amendment—akin to searching every unit in an apartment building because the management company stands accused of some crime. Meanwhile, prosecutors' insistence that U.S. Private Vaults' anonymous clients identify themselves before being able to seek a legal remedy runs afoul of the Fifth Amendment's protections against self-incrimination.

The FBI has returned the contents from some of the seized safe deposit boxes, but only after brazenly rifling through private documents and potentially misplacing some box-holders' valuables in an apparent attempt to find evidence of criminal activity.

A major piece of the U.S. Private Vaults saga remains hidden, as the government has unsealed only one of the two warrants that it claims were used to justify the raid in the first place.

Michelle Friedman Gerlis, one of the box-holders whose property was seized as part of the March 22 raid at U.S. Private Vaults, filed a motion in federal district court this week requesting that all warrants and supporting affidavits be made public.

"There is no question that Ms. Gerlis is entitled to copies of the documents that the government purported to rely on when it searched and seized the contents of her safety deposit boxes," Benjamin Gluck, the California attorney representing Gerlis (and other victims of the raid) wrote in court filings. "Indeed, the law is clear that she has a constitutional right of access to them under the Fourth Amendment."

The legal issues surrounding the still-secret warrant go beyond the acute legal issues facing Gerlis and the other plaintiffs in the U.S. Private Vaults saga. Those documents should be made public because of what they could reveal about how the FBI constructed a rationale for its brazen raid that resulted in hundreds of Americans potentially losing money and valuable assets despite not being charged with a crime.

To that end, Reason has joined Gerlis' lawsuit seeking to unseal the warrant.

"Reason intends to continue reporting on the Government's seizure of property from customers of U.S. Private Vaults and asserts a First Amendment right to review and inform the public about the content of the warrant material," writes Mike Alissi, Reason's publisher, in court filings this week.

Prosecutors seem to have approached the U.S. Private Vaults under the assumption that they can force innocent safe deposit box owners to disclose their identities in order to secure the return of their property—all without providing claims of wrongdoing. And that they can do that while keeping their own legal justifications secret. Federal courts should continue to eye those arguments with a healthy degree of skepticism.

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42 responses to “FBI Seized $900,000 From Safe Deposit Box on 'Pure Conjecture,' Federal Judge Says

  1. This is the same government in charge of protecting the Social Security lockbox.

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    2. “Social Security lockbox”… ha-ha-ha-ha-ha… ha-ha-ha-ha-ha.

      That lockbox was another of Congress’s Three Card Monte games from the get-to. There’s nothing in that lockbox except more IOUs.

      So it gets the level of protection it requires: none.

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  2. “When the FBI raided the facility on March 22, agents were armed with a warrant that explicitly forbade them from seizing the contents of the safe deposit boxes kept there.”

    And yet, somehow, not a single person engaged in this blatant contempt of court has been punished. Not to mention the kind of judge that allows secret warrants.

    1. Are cops punished when they raid the wrong house and kill people? No. So why should these agents be punished for blatantly ignoring a warrant and stealing millions in cash and other goods? Killing people is a lot worse. Hold them accountable for this and soon people will demand they be held accountable for murder. Jeez.

    2. Yep, any ordinary citizen found violating the expressed written directives of a judge is going to find himself in front of that judge sooner rather than later.

      That this judge doesn’t seem to mind being ignored is something worse than a mere curiosity.

      An actual journalist might even approach him and ask why he’s ok with people ignoring him.

      1. The judge knows what happens if he cock-blocks the feds too hard. That’s been established since Prohibition.

  3. Not a bad start for the Biden admin and DOJ. Violate civil rights, ignore orders from judges, make masking mandatory again, inflate currency, import sick people and move them around the country, lather rinse repeat.

    And jeffsarc and his various socks voted for Biden.

    1. Note the silence from the MSM about these government abuses, when they, and Reason, were telling us how Trump would be abusing his authority. The political class wants the government to be able to abuse us, except when Trump was in office. That tells you something.

    2. Ah, the obligatory butthurt, binarist, Trumpintreuer catamite fanboy script. We need a wet mop on the auto parts aisle, on the double!

  4. This is the kind of shit that happens when you store your personal property in the cloud.

    1. “We’re declaring a bank, uh, a CLOUD holiday!”

    2. You mean physical space.

    3. Cloud storage is a huge scam supporting by spying agencies so then they can freely spy domestically and not even both getting a warrant like they still have to if its data stored locally.

      While its true that its not the tech that is to blame but the government, the tech is just making it easier government to get away with violating the constitution.

  5. I sure hope they complied with CA’s mask mandate when they did this.

  6. Stop police “self” funding.

    1. Vote for National Socialism and you get Kristallnacht laws. Sooner or later causality sinks in, whether by induction or suction cup marks and inkstains.

  7. Every FBI agent that brazenly violated their warrant and searched the safety deposit boxes that they were explicitly forbidden from searching should be facing charges of grand theft and violation of civil rights.

  8. Sounds pretty gangster.

  9. In other news, the Los Angeles FBI office has multiple openings as a large group of agents recently retired.

  10. There appears to be a lot of FBI agents that need to be incarcerated, have their teeth knocked out or both. The minutemen shot redcoats for similar offenses. Should someone have done the same to these fbi thieves, survived and stood trial. That person should be acquitted. More folks need to be made aware of jury nullification.

  11. Apparently the u s constitution hasn’t made it into the FBI training manual yet.

    1. It originally was, but Hoover made them tear the pages out, Dead Poets Society style.

    2. How could they possibly know it was wrong?

  12. “A federal judge issued a sharp rebuke to the FBI”

    Fucking Judge, is he on Team Justice or what?

    “Michael Poliak, one of the co-owners of U.S. Private Vaults, has a lengthy criminal history that includes money laundering and may have used “dirty” money to purchase a stake in the company, according to an affidavit filed by an undercover police officer”

    All guilty, case closed!!

  13. Next step: The next time B of A is accused of shellacking its customers, the FBI will seize all the accounts of all their customers, since they were obviously involved in… something.

  14. The FBI has become a rogue criminal organization, that must be disbanded and prosecuted under the RICO statues. There doesn’t seem to be an honest agent in the entire agency. They ignore the Constitution and the oath they swore, they’re just like politicians but more corrupt.

    1. And whos going to do that? The CIA? Capitol police?

      We already lost. Best to try to get a job with the FBI or grin and bare it (our unlubed a-holes).

      1. There’s something to be said for violent uprisings.

  15. Relatedly, has reason been covering any of this stuff?

    WATCHING THE WATCHMEN

    https://www.buzzfeednews.com/article/kenbensinger/michigan-kidnapping-gretchen-whitmer-fbi-informant

    “The government has documented at least 12 confidential informants who assisted the sprawling investigation.. An examination of the case by BuzzFeed News also reveals that some of those informants, acting under the direction of the FBI, played a far larger role than has previously been reported. Working in secret, they did more than just passively observe and report on the actions of the suspects. Instead, they had a hand in nearly every aspect of the alleged plot, starting with its inception. The extent of their involvement raises questions as to whether there would have even been a conspiracy without them…

    This account is based on an analysis of court filings, transcripts, exhibits, audio recordings, and other documents, as well as interviews with more than two dozen people with direct knowledge of the case, including several who were present at meetings and training sessions where prosecutors say the plot was hatched. All but one of the 14 original defendants have pleaded not guilty, and they vigorously deny that they were involved in a conspiracy to kidnap anyone…

    Since its founding 113 years ago, the FBI has relied upon, and often paid, confidential informants to aid in criminal investigations. . .The tactic has a decidedly mixed record. Informants have helped make cases that averted terrible violence. But informants have also coerced innocent people, falsified evidence, and even committed murder while working for the FBI. The bureau’s reliance on informants, much criticized in the 1970s, received renewed scrutiny in the wake of 9/11, when they were used to probe Muslim groups for alleged involvement in Islamic terrorism… if the defense is able to undermine the methods used to build the Michigan case, it could add weight to the theory that the administration is conducting a witch hunt against militant groups — and, by extension, that the Jan. 6 insurrection was a black op engineered by the FBI.”

  16. I pray for the safety of Judge Gary Klausner and his family. If he cock-blocks the FBI any further, child pron may be mysteriously found on computers in his home.

  17. The FBI has become an organized crime arm of the Federal Govt. That whole bunch needs to be shut down, and in the future, citizen will demand it. The CIA needs to go, too. Both are corrupt to the core and out of control.

  18. We need to have the names of the FBI officials who deemed it proper to simply take other peoples’ money. Those are the people that need to go to jail.

  19. Abolition of asset forfeiture laws needs to be a key component of law enforcement reform in this country

    1. That is in the LP platform. All you have to do is vote.

  20. Voting for entrenched, subsidized looter Kleptocracy parties tells men with guns to keep jimmying open and rifling private safes. Thanks to the 1971 Tricky Dick anti-Libertarian law, anyone who surrenders tax money is subsidizing those looters. The trick is to make the suckers also surrender their votes instead of voting for the one party that at least preserves the Statement of Principles calling for abolishing the Communist Manifesto IRS. Them that counts the votes are keenly aware of how many LP votes they trash, burn, suppress but still cannot completely silence. Those votes are nervously recounted by gangland politicians before the subsequent election. This increases their law-changing leverage.

  21. We need a constitutional amendment that expressly prohibits the government to seize property without first charging and convicting the owner of the property. Additionally their should be a requirement that the government must prove that the property was directly related to the commission of the crime they were convicted of. The only exception would be a court decision to sell assets for monies to reimburse victims of the the crime.

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