California Seizing Property from Safety
Deposit Boxes
April 9, 2011 by
Robert Blumen
As reported by ABC
News, what started out as a program to hold unclaimed property, such
as the contents of safety deposit boxes owned by people who have moved
away without a forwarding address, has gone wildly out of control. The
program is now using the flimsiest of excuses to drill safe deposit boxes
and sell the contents, often for below-market value, the proceeds going
to the state’s general revenue.
In a case reminiscent of the
Monty Python organ
donor skit (or perhaps the movie Repo Men), a
San Francisco woman’s jewelry appraised at over $80,000 was sold even
though she lived a few blocks from her bank, had not moved, and was
current on all of her box rental feeds. In another case, a man’s
retirement savings consisting of $4 million of stock certificates were
sold; and “A Sacramento family lost out on railroad land rights their
ancestors had owned for generations”.
The program began life as a place to hold unclaimed property for up to 5
years while the state made attempts to locate the owner. Both the holding
period and the efforts to locate the owner have diminished over time. ABC
news indicates that there have been internal debates within the state on
these changes, with an internal memo objecting to efforts to to find the
owners on the grounds that “It could well result in additional claims of
monies that would otherwise flow into the general fund.”
What surprises me about these seizures is the scale and how
under-reported it is. This is the first article that I have seen on this
topic, compared to dozens of pieces and several books on
civil
asset forfeiture. This phenomenon is probably at least as large as
CAF Jarret Wollstein
cites a number in the low single-digit billions for asset forfeiture
(which may be an annual number) compared to the $32 billion (which may be
a multi-year aggregate) appearing in the ABC news story. In comparison,
looting of safe deposit boxes requires even less due process than asset
forfeiture, which at least requires that the property be accused of a
crime, and can be fought in court.
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