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United States v. Sikutwa

United States District Court, D. Idaho

November 22, 2016

UNITED STATES OF AMERICA, Plaintiff,
v.
LAWRENCE SIKUTWA, Defendant.

          MEMORANDUM DECISION AND ORDER

          B. LYNN WINMILL CHIEF JUDGE.

         INTRODUCTION

         Before the Court is third party Iman Mohamed's Motion to Quash Pursuant to 12 U.S.C. § 3410 (Dkt. 83). Ms. Mohamed seeks to quash a subpoena issued to Wells Fargo Bank. The subpoena asks the bank to produce various documents relating to Ms. Mohamed's bank accounts and financial transactions. For the reasons explained below, the Court will grant the motion and quash the subpoena to the extent it seeks documents related to Ms. Mohamed's finances. The Court will deny the motion to the extent it seeks to prevent the bank from producing records related to Defendant Lawrence Sikutwa.

         BACKGROUND

         In July 2013, Defendant Lawrence Sikutwa pleaded guilty to conspiring to file false claims for refunds, in violation of 18 U.S.C. § 286. The Court sentenced Mr. Sikutwa to 21 months' imprisonment, followed by a three-year term of supervised release. See Judgment, Dkt. 81. The Court also ordered Mr. Sikutwa to pay $1, 466, 799 to the IRS as restitution. Mr. Sikutwa has hardly made a dent in satisfying the restitution order; according to the government, he still owes $1, 465, 544. See Response, Dkt. 85, at 2.

         In its efforts to collect the restitution order, the government is now seeking to obtain information relating to third party Iman Mohamed's finances. Ms. Mohamed is Mr. Sikutwa's wife. The couple married on August 7, 2015, just a few weeks after Mr. Sikutwa was released from prison.[1] The government says it believes Ms. Mohamed's financial records “may lead to information regarding money, accounts, and other assets of Defendant.” Response, Dkt. 85, at 1.

         Ms. Mohamed moves to quash the subpoena the government issued to Wells Fargo Bank. In her motion, she says that “my finances, accounts, and limited liability company are 100% owned by myself and also held separate and apart from Lawrence Sikutwa . . . .” Mohamed Stmt., Dkt. 83-1. She also points out that she has “not violated any criminal or civil statute” and that she is not a party to the underlying criminal case.

         ANALYSIS

         Ms. Mohamed moves to quash the subpoena under the Right to Financial Privacy Act (RFPA), 12 U.S.C. § 3401 to 3422. This Act has been described as a “statutory Fourth Amendment for bank customers.” Davidov v. SEC, 415 F.Supp.2d 386, 388 (S.D.N.Y. 2006). It is “intended to protect the customers of financial institutions from unwarranted intrusion into their records while at the same time permitting legitimate law enforcement activity.” H.R. Rep. No. 95-1383 (1978), reprinted in 1978 U.S.C.C.A.N. 9273, 9305. In keeping with this intent, the Act provides that the government may issue a subpoena for the records of customers of financial institutions only if the “subpoena is authorized by law and there is reason to believe that the records sought are relevant to a legitimate law enforcement inquiry.” 12 U.S.C. § 3407(1). Another provision lays out the procedures for bank customers to challenge subpoenas issued to a bank, as well as the procedures for the district courts to rule on those challenges.[2] See 12 U.S.C. § 3410. This provision requires the Court to quash the subpoena if any of the following is true: (1) the government failed to substantially comply “with the provisions of this chapter”; or (2) “there is not a demonstrable reason to believe that the law enforcement inquiry is legitimate and a reasonable belief that the records sought are relevant to that inquiry.” 12 U.S.C. § 3410(c).

         1. Procedural Compliance

         Ms. Mohamed does not argue that the government failed to comply with RFPA's procedural requirements and the record does not reveal any failures in that regard. See, e.g., 28 U.S.C. §§ 3407, 3410; Aug. 17, 2016 Letter to Iman Mohamed, Dkt. 85-4.

         2. Legitimate Law Enforcement Inquiry

         The next question is whether the subpoena was issued as part of a “legitimate law enforcement inquiry.” 12 U.S.C. § 3407, 3410. The government says the “inquiry” is its ongoing efforts to collect information regarding Mr. Sikutwa's assets so that it can enforce the restitution order. Ms. Mohamed does not dispute the existence of an underlying “inquiry.” Accordingly, the Court will assume that the requisite, underlying “inquiry” exists by virtue of the government's efforts to collect the restitution order. See generally United States v. Thomas, 165 F.Supp.3d 992, 995 (D. Colo. 2015).

         The government may enforce the restitution order in accordance with the practices and procedures for collecting a civil judgment. See 18 U.S.C. § 3613(a), (c); see also 28 U.S.C. § 3202 (setting forth procedures to enforce judgments). Thus, the issuance of a civil subpoena under Rule 45 of the Federal Rules of Civil Procedure is an appropriate means of seeking information related to the enforcement of a restitution order. Further, under the Federal Debt Collection Procedures Act, the government may take discovery in any manner authorized under the Federal Rules of Civil Procedure in an action on a claim for a debt. 28 U.S.C. § 3015. And Rule 69 permits discovery in aid of a judgment “from any person - including the judgment debtor - as provided in these rules . . . .” Fed.R.Civ.P. 69 (emphasis added). See generally Wright & Miller, 12 ...


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