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(with apologies to Dick Tracy)
By Armando G. Cuellar, Jr.
Friday afternoon found Elihu thinking about the weekend, the children’s soccer game and the dinner party he and Ruth had planned with the Sheridans. There would be shopping to do, a house to clean and a menu to prepare. He stared at the clock trying to decide if it was too early to leave his office for the day. The phone rang, loudly it seemed to Elihu, and he debated whether to answer it or to let the caller leave him a message on the voice mail system. Then, thinking it might be Ruth, he picked up the receiver just before the fourth ring.
“Elihu, this is Sergeant Rivera over at the Riverdale Police Department. Our boys served a paper on a local doper and snagged about three kilos of cocaine. Pretty good case in all, but the reason I’m calling you is because, along with the dope, the narcs found some bank records and some financial statements. The records show this guy has over half a million dollars in three accounts. Normally we’d put together an affidavit in support of an order of seizure, but there are so many financial records that it’s gonna take us a good part of the weekend and part of next week to go through them all. Plus, this guy’s got an auto repair shop, so he may have an explanation for the money. We need time to go over these records to see if we have PC to seize the accounts. Know what I mean? Anyway, the guy’s in custody, but he’s got a girlfriend, and our fear is she’ll empty these accounts before we can get to them.”
Elihu grabbed the duty roster for the on-call judges and checked the clock again. It was 4:30 and the likelihood that he would catch the duty judge at this hour before the week-end was slim to none. Even if he did, he couldn’t get an injunction without affidavits. He told Rivera to stay put while he figured out what to do. If he could somehow pre-vent the doper and his girlfriend from getting to the accounts, even for a few days, that would buy the narcs the time to go through the records. But he had to be able to do it without going to a judge.
“Impossible,” said Vicky McDaniels, his roommate at the DA’s Office. “First, you have the Right to Financial Privacy Act which limits the information you can get from the bank without a court order, and second, even if you could get the information, you still need a court order to get the injunction.”
Elihu ignored Vicky — something he did with more and more frequency — and called a colleague in an adjoining county.
“Yeah, I hear you,” replied Kevin Lee in response to Elihu’s inquiry. Kevin suggested that Elihu contact Bill Klein from the Camana County District Attorney’s office.
“You can do it,” said Bill. “In fact, we do it all the time. It’s called an adverse claim and here’s how it works. Take a look at section 952 of the Financial Code.”
“Got it,” said Elihu as he located it in his annotated codes. “Let’s see, this says a person who has a fiduciary relationship with an account holder can file an adverse claim if he thinks the account holder is about to misappropriate the funds in the account. The claim has to state facts establishing the fiduciary relationship and the grounds for the claim. And let’s see, the bank can freeze the account for three court days without liability on its part or liability for the sufficiency or truth of the facts alleged in the affidavit. This is just what I need.”
“Right,” replied Klein.
“But, where is fiduciary relationship between the Riverdale Police Department and the doper or his girlfriend?” asked Elihu.
“Take a look at Civil Code section 2224,” said Bill. “This is the codification of the involuntary trustee doctrine. Basically, it says that a person who obtains assets by committing wrongful acts becomes an involuntary trustee of the assets for the benefit of the person who would otherwise have had it.”
“So, if I understand you, and I think I do,” said Elihu, “if our doper made the money in the accounts by trafficking in cocaine, he becomes a trustee for the rightful owner.”
“Yes,” said Klein.
“And,” continued Elihu, “the rightful owner of drug proceeds under the Narcotics Asset Forfeiture Laws is the state of California. So, the Riverdale narcs, as representatives of the state charged with enforcing the forfeiture laws, have a fiduciary relationship with the doper and his girlfriend and can file the adverse claim in the name of the state of California.”
“You got it,” replied Klein.
“And you don’t have to have a judge’s authorization?” queried Elihu.
“No,” said Klein, “just have the case agent sign and date it. Also, make sure they call the bank in advance of serving the claim and tell them they’re on their way with it. They will be much more cooperative if they get a heads-up. That’ll give your narcs until Tuesday to go through the records and see if they have PC to seize the accounts.”
“That’s brilliant,” Elihu told Klein.
“Would you like me to fax you a sample adverse claim and supporting affidavit?” asked Bill?
“If you wouldn’t mind,” said Elihu, realizing that his dinner party was sure to be a great success.
*
From the Crimestoppers Notebook Editor: All of the characters in this story are real. No names are changed to protect the innocent as God Almighty, in His infinite mercy, does that as a matter of heavenly routine. Persons desiring a sample copy of an adverse claim and supporting affidavit should call Armando G. Cuellar, Jr. at (510) 272-6339.
Reprinted with permission from Did You Know…, June 1995, copyright 1995, California District Attorneys Association, Sacramento, CA 95814.
Editor’s Note (JCFR) – While the above story is specific to California, our information is that similar remedies are available in all states and that this solution can be stretched to apply to insurance fraud cases.
© Copyright 1995 Alikim Media