Not, alas, the kind of story completely foreign to archivists

Italian police said on Friday they had recovered 36 manuscripts by novelist Giovanni Verga worth some four millions euros ($5.25 million):

Italian police said on Friday they had recovered 36 manuscripts by novelist Giovanni Verga worth some four millions euros ($5.25 million). The manuscripts were stolen in the 1930s. Police also recovered drawings and letters between Verga and the poet Gabriele D'Annunzio, philosopher Benedetto Croce and dramatist Luigi Pirandello. The documents were lost when Verga's son, Giovanni Verga Patriarca, lent them to a historian in the small town of Barcellona Pozzo di Gotto in Sicily who then refused to return them and hid them. "The precious documents were never returned and attempts to retrieve them have always failed as they were very well squirrelled away," Antonio Coppola, who led the police operation, told AFP. 

The lead to this material was their listing in an auction catalogue.

As an archivist one certainly encounters cases where papers have been 'loaned', not always with the drawing up of a formal contractual agreement, to biographers or other historians, or 'temporarily' to a university department or library. Also instances of depositors who want to embargo a collection until the official biographer/historian has finished with them. This is just marginally acceptable if the biographer or historian is going to complete their task within a reasonable length of time, but there have been cases where slow-moving scholars have sat on papers for years if not decades. (There are also issues around the physical conditions under which papers are kept, whether the biographer is rearranging them for their own research purposes, etc, etc.)

Scholars have been known to be unduly possessive of archives in their possession or even just on which they have worked, and to be anxious lest someone should 'steal' their research. However, I would argue that it's less a matter of the particular material and more about what the scholar is doing with it, and it's very unlikely that two scholars would want to be using the same papers for exactly the same purpose. (There is perhaps a somewhat reasonable concern in the case of biographies, but even then, the biographers will be bringing their own interpretation to the material.)

I also find a number of questions evoked by this report: Unique transgender archive sent to Canadian university after offer to LSE is rebuffed but I don't have enough information to say anything particularly useful. It's distressing that they're not remaining in the UK, certainly.

And while it was satisfactory that the threat to Croydon's archive services did not come to pass, the Council's attitude to heritage collections is still problematic: Historic collection worth millions threatened with dispersal as Croydon council looks to raise funds for arts complex