A federal appeals court made a pivotal ruling, determining that the FBI transgressed the constitutional protections of individuals during a raid on a Beverly Hills establishment under suspicion of money laundering. The U.S. 9th Circuit Court of Appeals concluded that the agency breached the Fourth Amendment rights of the clients at U.S. Private Vaults. This conclusion was based on the FBI’s action of inspecting and itemizing the contents within 1,400 safe deposit boxes, despite lacking specific warrants for each box.
The verdict, overturning an earlier decision by a lower court, has been celebrated as a major triumph for individuals impacted by the raid. Rob Frommer, a Senior Attorney with the Institute for Justice who represented numerous plaintiffs, shared his contentment with the result, commenting, “This is a decisive win, not solely for our clients, but also for the numerous individuals who have endured years of turmoil due to the actions of the FBI.”
During the March 2021 raid, agents seized approximately $86 million in cash and a substantial amount of coins, gold bars, jewelry, silver, and other valuables. The FBI then initiated administrative forfeiture proceedings against an undisclosed number of the boxes. This process allows the government to seize assets believed to be linked to a crime, even without charging the owner.
The panel from the 9th Circuit determined that the FBI went beyond the limitations of its search warrant and breached its regulations by carrying out inventory searches on items that were not listed in the warrant. The court emphasized that the government did not notify the judge about its plans to seize boxes that included cash or items valued at a minimum of $5,000.
In his written decision, Circuit Judge Milan D. Smith Jr. expressed concern over the government’s actions, stating that the inventory searches were reminiscent of the “limitless searches of an individual’s personal belongings” prevalent during colonial America. He emphasized that these abuses of power were the very reason the Fourth Amendment was established.
One of the plaintiffs in the class-action lawsuit, Jeni Pearsons, described the court’s ruling as “incredibly gratifying.” Pearsons and her husband had $20,000 in silver and $2,000 in cash seized during the raid. She joined forces with the Institute for Justice to fight for the return of her property and ultimately succeeded. However, when Pearsons attempted to reclaim the $2,000, she discovered that the FBI had lost it.
While this ruling is seen as an important step in curbing civil forfeiture abuse, Frommer believes that more needs to be done. He expressed concerns that the FBI will view this ruling as a mere setback and continue its actions unless faced with real consequences.