Two Americans have accused the FBI of losing or stealing their property after it was seized through what they describe as a "shady" process.
The nonprofit law firm Institute for Justice has filed two lawsuits on behalf of clients who had their property taken from safety deposit boxes during an FBI raid on U.S. Private Vaults in March 2021. Don Mellein and Jeni Pearsons, the plaintiffs in the lawsuits, discovered that some of their property was missing after the FBI agreed to return it.
According to Joe Gay, an attorney with the Institute for Justice, the FBI broke into the box containing the plaintiffs' property, and what happened next is unclear. Gay stated, "All we know is that their property was in a box and safe before the FBI broke into the box. Once the FBI broke into the box, we honestly don't know exactly what happened. We don't know if they lost it. We don't know if somebody pocketed it and walked away. We have no way to know."
Don Mellein, a retired civil servant, had cash and 110 gold coins worth hundreds of thousands of dollars in his box. He had invested in the precious metals after selling his Malibu home in 2002. Jeni Pearsons and her husband Michael Storc had stored around $20,000 in silver and $2,000 in cash in their box as a financial safeguard.
Neither Mellein nor Pearsons were charged with a crime. The FBI had been investigating U.S. Private Vaults, which later pleaded guilty to conspiracy to launder drug money and shut down following the raid.
After the FBI seized their property, Mellein and Pearsons received a notice stating that the FBI wanted to keep their property through a process known as civil forfeiture. Pearsons said she had never heard of civil forfeiture before and found the options presented on the notice disingenuous and shady. She said, "It's the least transparent process. It's not something that you would do if your intent was to find out who these items belonged to."
Pearsons teamed up with the Institute for Justice to fight for her property, while Mellein hired an attorney and spent $40,000 to reclaim his items. Both eventually prevailed in court, but when they went to the FBI's Los Angeles office to claim their property, they discovered that some of their items were missing.
Mellein received the cash from his box but none of his 110 gold coins. The FBI claimed to have no record of the missing coins, as they were not listed on the property receipt. When Mellein asked for a copy of the video inventory of the box, the FBI said that they had abandoned their initial plan to film the process due to the rush to process a large amount of property.
According to Joe Gay, the attorney from the Institute for Justice, the search conducted by the FBI was hectic and frenzied, with agents crowding into the vault and spending a week ransacking the boxes. The FBI's inventories listed items as "miscellaneous coins" or "miscellaneous items," which Gay described as utterly useless for protecting owners' property.
Mellein filed a lawsuit against the government in August 2021 to force the return of his coins. Months later, the government found and returned 47 of the coins but told Mellein that he must dismiss his lawsuit and file a claim with the FBI to track down the remaining 63.
In March 2023, after filing his claim, the FBI informed Mellein that it had investigated itself and found no evidence of wrongdoing or carelessness. 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. I'm disappointed that I have to sue again to get property back that should have been given back to me over two years ago."
Similarly, when Pearsons went to claim her property, she discovered that the $2,000 in cash from her box was missing. The FBI never denied that the cash was in the box but simply did not return it. Pearsons was told that someone from the U.S. Marshal's office would contact her about the missing cash, but no one ever did.
Pearsons speculated that the FBI's actions were either the result of sloppy work or a deliberate attempt to keep everything they seized. She said, "Could be that the way that the FBI and the law enforcement carried this out is just really sloppy work. Or there was never any intention of giving it back, and so it really didn't matter because they thought they just got to keep everything. So to them, there was one pile."
Joe Gay emphasized that regardless of how the property went missing, the lack of legal recourse for owners is unacceptable. He stated, "We don't know for sure how the property disappeared, we just know it disappeared. And whether it's negligence, whether it's something worse, the government shouldn't be able to rely on its own shoddy recordkeeping to avoid responsibility for losing their property."
The lawsuits filed by the Institute for Justice aim not only to recover Mellein and Pearsons' property but also to provide victims of civil forfeiture with the ability to challenge agencies if their property goes missing. Gay explained, "We're basically fighting against the notion that people shouldn't have a remedy against the government when the government takes their property."
Both Mellein and Pearsons expressed their disappointment and disillusionment with law enforcement. Mellein said, "When I was growing up, we trusted and respected law enforcement, especially the FBI. I'm not filing this lawsuit just for me; I'm fighting for a better world where people can trust law enforcement to do the right thing. I'm fighting to make law enforcement better."
Pearsons added, "I would love to be able to be thankful to law enforcement for taking care of whatever criminal circumstance there was and for making sure that my involvement with it didn't have to be painful. But rather, they've literally stolen."
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