Raids: Anonymous Safety Deposit Box US Private Vaults, FBI Illegal General Warrants

grarpamp grarpamp at
Mon Apr 5 20:27:11 PDT 2021

FBI Raids Business Renting Anonymous Safety Deposit Boxes, Forces
Customers To Reveal Identity To Get Stuff Back

In a case that's already sparked one lawsuit, a Beverly Hills strip
mall business which rents private, anonymous safe deposit boxes was
raided by the FBI last month - at which time the agency conducted a
blanket seizure of hundreds of customers' belongings.
Federal agents relied on informants and at least one undercover
officer to gather information about transactions that took place at
U.S. Private Vaults.
(Irfan Khan / Los Angeles Times)

To retrieve their valuables, customers will need to "identify
themselves and subject themselves to an investigation to verify their
legal ownership," according to the Los Angeles Times, which noted that
one customer has already gone to court claiming that the government
overreached by confiscating the contents of every security box.

The company, U.S. Private Vaults, has been accused of laundering money
for drug dealers - who anonymously stashed guns, drugs and cash.

    In an indictment against U.S. Private Vaults, Inc., the U.S.
attorney for Los Angeles accused the company of marketing itself
deliberately to attract criminals, saying it brazenly promoted itself
as a place customers could store valuables with confidence that tax
authorities would be hard-pressed to learn their identities or what
was stored in their locked boxes. To access the facility, customers
needed no identification; it took just an eye and hand scan to unlock
the door.

    “We don’t even want to know your name,” it advertised, according
to prosecutors.  -Los Angeles Times

The feds used "multiple informants and at least one undercover police
officer who posed as customers" to surveil the store and gather
information about its customers.

One of the company's owners and several employees are accused of being
involved in drug sales that took place at the business, as well as
helping customers to convert cash into gold in a way that would avoid
suspicion. Of note, U.S. Private Vaults shared a storefront with Gold
Business - named as a co-conspirator in the indictment - which is
accused of helping customers convert cash into gold to avoid having to
report currency transactions which exceed $10,000.
A sign taped to the front door of U.S. Private Vaults instructs
customers on how to recover their possessions.
(Irfan Khan / Los Angeles Times)

    In the March 9 indictment that was unsealed Friday, a federal
grand jury charged U.S. Private Vaults with three counts of conspiracy
— to launder money, distribute narcotics and structure cash
transactions to dodge detection. None of the people who are allegedly
behind the operation were named in the court records. It is was not
immediately clear whether any individuals will face criminal charges
as well. -Los Angeles Times

The FBI and Drug Enforcement Agency took five days to go through and
process all the boxes after the raid began on March 22, according to
court documents. US prosecutors argued on Friday that while the
original warrant remains under seal, the magistrate judge who approved
it thought that the sweeping seizures were appropriate.

"The government seized the nests of safety deposit boxes because there
was overwhelming evidence that USPV was a criminal business that
conspired with its criminal clients to distribute drugs, launder
money, and structure transactions to avoid currency reporting
requirements, among other offenses," prosecutors claimed in papers
filed in Los Angeles federal court.

According to prosecutors, the raid produced an unspecified number of
weapons, fentanyl, OxyContin, and "huge stacks of $100 bills" which
were flagged by drug-sniffing dogs. One box reportedly had $1 million
in cash.

The indictment was unsealed on Friday - just one hour before a
court-issued deadline to respond to a lawsuit brought by a US Private
Vaults customers who alleged that the blanket seizure was

    The unnamed customer, listed in court papers as John Doe, said the
search warrant should not have authorized seizure of the jewelry,
currency and bullion that he kept in his three boxes at U.S. Private
Vaults, because there was no probable cause to suspect the person
committed a crime.

    “Just as the tenant of each apartment controls that space and
therefore has a reasonable expectation of privacy in it, each of the
hundreds of renters of safety deposit boxes ... has a separate
reasonable expectation of privacy in his or her separately controlled
box or boxes,” the person’s attorney, Benjamin N. Gluck, wrote in the
complaint. -Los Angeles Times

The customer seeks to stop the FBI from requiring anonymous customers
to reveal themselves and undergo an investigation to verify legal
ownership of their valuables - with attorney Benjamin Gluck arguing
that the government is holding his  client's goods "hostage" until he
identifies himself. Gluck pointed to a statement by assistant US
Attorney Andrew Brown describing the procedure for retrieving

"Though Mr. Brown perhaps deserves credit for his candor, his
announced plan is grossly improper and manifestly unconstitutional,"
wrote Gluck, noting that Brown had previously conceded in court papers
that some US Private Vaults customers were "honest citizens to whom
the government wishes to return their property."

"But the majority of the box holders are criminals who used USPV’s
anonymity to hide their ill-gotten wealth," he wrote. "To distinguish
between honest and criminal customers, the government must examine the
specific facts of each box and each claim, precisely what the
anonymous plaintiff wants to prevent by refusing to disclose not only
his identity, but even the specific boxes he claims are his."
Federal agents have seized evidence from U.S. Private Vaults, a
Beverly Hills business that has been charged with three counts of
(Irfan Khan / Los Angeles Times)

Beverly Hills attorney Nina Marino, who represents several US Private
Vaults clients, said that even if there were some criminal customers,
"that does not authorize the government’s conduct in this sweeping
action of not only seizing innocent box owners’ property, but viewing
that property."

"Every single person that paid money on a monthly basis did that with
the expectation of maintaining their anonymity, and it’s just
outrageous that the government has such low regard for the 4th
Amendment and for an individual’s expectation of privacy," she added.

UCLA law professor Beth Colgan called the issue "fascinating," adding
that the big question is whether the search warrant was based on
sufficient probable cause to believe that evidence of criminal
wrongdoing would be found in virtually all of the safe deposit boxes.

"I would just be very surprised if a judge had approved a warrant that
would allow the FBI to go through every single box absent evidence
that the entire system was corrupt," said Colgan. "Maybe they have the
evidence, and that’s the thing we don’t know."

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