LOS ANGELES (CN) – The treasurer for Sen. Diane Feinstein’s campaign fund has sued the First California Bank for aiding and abetting Kinde Durkee, the “Bernie Madoff of campaign treasurers.”
Durkee, a formerly respected longtime campaign treasurer, was arrested earlier this month in Burbank, Calif., on charges that she siphoned millions in political contributions.
Feinstein’s treasurer, William Wardlaw, claims in his suit that First California Bank assisted Durkee and her firm, Durkee & Associates (D&A), and “was at the heart of the illegal transfer of money” out of the Feinstein campaign’s accounts.
Durkee allegedly used the pilfered funds to pay her credit card bills and other personal and business expenses.
“Despite knowledge of this pervasive pattern of misconduct First California Bank continued to provide banking services to Durkee and Durkee & Associates LLC for many years, happy to collect the fees and interest generated by the scores of accounts Durkee maintained at the Bank,” Wardlaw claims in Superior Court. “Investigation will reveal other professionals, including attorneys accountants and additional banks, had full knowledge of the wrongful acts committed by D&A and the individuals.”
Wardlaw filed suit alongside the Feinstein for Senate and Fund for the Majority committees, both of which employ him as treasurer. The named defendants to the lawsuit are First California Bank; Durkee & Associates; Durkee; her partner, John Forgy; and her business associate Matthew Lemke.
Sen. Feinstein political strategist Bill Carrick told Courthouse News the campaign was “shocked” when prosecutors uncovered Durkee’s scheme.
“We’re bringing this action against all the parties in order to access our bank records and financial records and we also want to be reimbursed for any funds that were wrongfully taken from the Feinstein for Senate Committee,” Carrick said.
“If we could get access to our bank records like every other customer we could try to determine how much we should be reimbursed,” he added. “One thing that’s difficult to understand is how the bank let this strange activity continue on a daily basis without reporting it to bank regulators and customers.”
The campaign described how Durkee and her company betrayed decades of respect and trust.
“According to a federal criminal complaint filed against her by the United States Attorney General, Durkee has embezzled millions of dollars over the years from her clients,” the complaint states. “As described by U.S. Representative Susan Davis of San Diego, it now appears that Durkee was ‘the Bernie Madoff of campaign treasurers,'” the complaint states.
Durkee first worked for Feinstein during her first 1992 campaign for the Senate and then each subsequent re-election bid.
During all this time, Durkee and her company siphoned millions of dollars from Feinstein’s committees using a “web of accounts” at First California Bank, according to the complaint.
“A fraud of the scale alleged herein could not have occurred, and did not occur, without the knowing involvement of First California Bank,” the lawsuit says.
First California “intentionally ignored dozens of red flags,” including evidence of unusual and suspicious transfer activity, and that Durkee “ensured the branch’s cooperation by lavishing the bank with profits,” the complaint says.
“What is clear, is that Durkee and her cohorts – each with the full knowledge of the other – abused the trust she gained over decades in the political and non-profit world, in order to steal millions of dollars from innocent Americans who have supported the lifetime of good works performed by committed individuals like Senator Feinstein and other public servants and entities” the suit says.
Feinstein’s team says they want “to obtain justice for all those who have contributed money in support of Senator Feinstein, other elected officials, and the dozens of non-profits Durkee has defrauded.”
The Sept. 23 complaint seeks injunctions and compensatory and punitive damages, alleging a host of claims including fraud, conversion, breach of contract and bad faith. Wardlaw and the committees are represented by Joseph Cotchett with Cotchett, Pitre & McCarthy.
On the same day, First California Bank filed a complaint in interpleader, asking the same court to discharge it from liability for commingled and transferred funds in hundreds of Durkee accounts.
First California Bank did not immediately respond to a request for comment.