Feinstein sues bank to find missing campaign cash

Senator Dianne Feinstein may have lost millions of dollars in campaign donations in an alleged embezzlement scheme by her treasurer. Today, the California Democrat sued the bank where the money was deposited to find out where it went.

Feinstein filed suit in California Superior Court in Los Angeles against Westlake Village-based First California Bank; Kinde Durkee, the former treasurer, who was arrested Sept. 2 for allegedly stealing money from lawmakers’ campaign accounts and other clients.

According to her complaint, Feinstein’s Senate campaign account received statements saying she had $2.5 million in the bank at the end of July. In reality, there was only $356,250 in the accounts, the suit said. Feinstein’s committee reported a balance of $5 million at the end of June, Federal Election Commission reports show.

“We are obviously in a situation where we’re trying to find out where our money is,” said her chief campaign consultant, Bill Carrick. “What we want is a full accounting of our records in that bank and to be reimbursed for everything that was taken from us. All of this happened inside their bank, which they had to have full knowledge of.”

A call to bank headquarters wasn’t returned.

Carrick said the suit was filed only after the bank refused to release records to the Feinstein campaign unless it agreed to hold the bank harmless for losses. The suit itself says the bank should shoulder the blame.

‘Illegal Transfers”

Durkee’s actions “required the assistance of willing financial institutions,” the suit said. “In this case, First California Bank was at the heart of the illegal transfer of money” from Feinstein’s accounts.

The suit said Durkee, “with the substantial assistance” of the bank and others, used money from Feinstein’s accounts “to cover her personal and business expenses and to reimburse other elected officials’ campaign funds from which she had also embezzled.”

Feinstein, 78, and California Democratic Representatives Susan Davis and Loretta Sanchez were among the lawmakers who employed Durkee. Davis earlier this month sent a letter to supporters saying “We have been robbed!!”

--Editors: Jeanne Cummings, Robin Meszoly

To contact the reporter on this story: Jonathan D. Salant in Washington at jsalantbloomberg.net.

To contact the editor responsible for this story: Mark Silva at msilva34bloomberg.net.