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7 Critical Mistakes Judgment Creditors Make Attempting to Collect Their Judgment – Mistake #3

There are seven critical mistakes judgment creditors make when attempting to collect their judgment. Over the next several weeks, we’ll be discussing each mistake in detail… and how to correct it. Last week, we covered mistake #2: Expecting the judgment debtor to actually appear for the deposition, tell the truth, and produce the subpoenaed documents. Now, let’s identify the problem we are dealing with this week.


MISTAKE #3: EXPECTING TO FIND THE POT OF GOLD AT THE END OF THE RAINBOW

Judgment Creditors often expect they (or their professionals) will find that big bank account. Garnish the bank and you magically have recovered all the money to satisfy the entire amount of their judgment.
 Finding the judgment debtor’s bank account(s) is a necessary and very important part of the process, but it is just the first step in a journey to satisfy your judgment. The money you recover by garnishing the account may be a rather insignificant amount or a substantial amount and either way, it’s a good start—but far from the end result.

Here’s how it works:

When you serve the bank with the garnishment, you should also serve a subpoena for copies of all credits and debits (front and back of the debits).  The credits may come from other assets of the debtor such as transfers from savings accounts, distributions from trusts for which they are the beneficiary, rental payments from real estate holdings, or they may be payments from oil and gas investments or income from securities your debtor owns. You really do not want the periodic income; you want to take the entire corpus of the asset. As for the debits, you want to see where the checks are deposited. They may lead to other bank accounts or brokerage accounts of your debtor; payments on the mortgage on rental property your debtor owns; purchase of assets that can be recovered; fraudulent transfers that lead to recoveries; revocable trust—the assets of which may be taken; etc.

You should also get all incoming wire transfers. You will be able to identify the source, which may be additional accounts (domestic and/or offshore) belonging to your debtor that you can trace to find assets that have gone through it. You will get the wiring instructions and copies of all outgoing wires that may lead to other sources of recovery, domestic or offshore.

In addition to the loan application you have subpoenaed from the bank (or Mortgage Company) you will also subpoena copies of all tax returns provided, personal and business. From these tax returns you will learn of income- producing real estate which you may be able to take as well as K-1’s that indicate income from partnerships or LLCs that your debtor has ownership in, etc. If you determine it to be a single member LLC, you can take the entire LLC, since courts have held that single member LLCs have no asset protection.

These debtors’ financial statements and tax returns can actually provide you with the DNA of the debtors’ financial life—your road map to unwinding his financial world and recovering the assets to satisfy your judgment.

So finding the debtors’ bank account is very important, but it is usually only the first step of what may be a challenging but profitable journey to the satisfaction of your judgment.

As Seen In

Financial Forensic Services, LLC is proud to staff Certified Fraud Examiners

Testimonial

” I was prepared to dismiss a federal case involving millions of dollars against a local individual who claimed to have no substantial assets. After your staff hit the records and delved into the transactions behind the transactions, you discovered the individual to actually be worth a few million dollars. We continued the case to conclusion. We were also very happy with the financial background examinations you conducted of the former directors of two failed national banks. The heart of any civil case is whether there is a pot at the end of the lawsuit. You were our lucky leprechaun in finding such pots.”

R. Michael Sentel
, Former Section Chief Legal Division, FDIC

2014-11-11T18:13:08+00:00

R. Michael Sentel
, Former Section Chief Legal Division, FDIC

” I was prepared to dismiss a federal case involving millions of dollars against a local individual who claimed to have no substantial assets. After your staff hit the records and delved into the transactions behind the transactions, you discovered the individual to actually be worth a few million dollars. We continued the case to conclusion. We were also very happy with the financial background examinations you conducted of the former directors of two failed national banks. The heart of any civil case is whether there is a pot at the end of the lawsuit. You were our lucky leprechaun in finding such pots.”

“Joe is the most competent investigator I’ve ever found. He has rare ability to find hidden assets. Others claim it, Joe has it. He understands the Rules of Evidence, he knows how to talk to people to develop a fact pattern, and he has a sixth sense for fraud. Joe has unquestioned integrity and delivers value for his services.”

Andrew Quiat
, Attorney

2014-11-11T18:12:51+00:00

Andrew Quiat
, Attorney

“Joe is the most competent investigator I’ve ever found. He has rare ability to find hidden assets. Others claim it, Joe has it. He understands the Rules of Evidence, he knows how to talk to people to develop a fact pattern, and he has a sixth sense for fraud. Joe has unquestioned integrity and delivers value for his services.”

“Joe Dickerson is the industry standard. You can measure the rest by what he does, and I say that without equivocation. Joe has incredible insight into the dark world of fraud. He understands the devious ways in which people perpetrate white-collar crime.”

Jan Schlichtman
, Attorney at Law

2014-11-11T18:20:55+00:00

Jan Schlichtman
, Attorney at Law

“Joe Dickerson is the industry standard. You can measure the rest by what he does, and I say that without equivocation. Joe has incredible insight into the dark world of fraud. He understands the devious ways in which people perpetrate white-collar crime.”

“When I was general counsel for First Interstate Bank, I used Joe Dickerson for locating assets, investigating behavior and asset discovery. He did excellent work and always got the information I needed without compromising the bank in any way. He’s more thorough and kept in better touch with me than other investigators. I’d give him a grade of 96 or 97 out of 100.”

Frank Brainerd, Retired
Banker/Attorney

2014-11-11T18:20:20+00:00

Frank Brainerd, Retired
Banker/Attorney

“When I was general counsel for First Interstate Bank, I used Joe Dickerson for locating assets, investigating behavior and asset discovery. He did excellent work and always got the information I needed without compromising the bank in any way. He’s more thorough and kept in better touch with me than other investigators. I’d give him a grade of 96 or 97 out of 100.”

“They went overboard in providing excellent service. I was very pleased with what they provided for me as their end product. Financial Forensic Services really understands how a case needs to be put together in order to be presented to a jury. Their PowerPoint presentation tied everything together. It was thorough, it was concise, and it got the job done.”

Jim Thomas
, Prosecuting Attorney

2014-11-11T18:21:32+00:00

Jim Thomas
, Prosecuting Attorney

“They went overboard in providing excellent service. I was very pleased with what they provided for me as their end product. Financial Forensic Services really understands how a case needs to be put together in order to be presented to a jury. Their PowerPoint presentation tied everything together. It was thorough, it was concise, and it got the job done.”

“As an environmental law firm, we use Joe Dickerson to locate prior business owners and do corporate genealogies. He is persistent, that’s the key to a good investigator, and he has a knack for understanding how people move money and do business. That tells him what rocks to look under. Joe is vastly superior to other investigators in two ways: he lets you know what’s going on and he’s honest with you, because he tells you if there’s really anything there worth pursuing. He is unusually thorough and creative finding people. Joe has earned his fee every time.” “If the information is to be found, then I believe that they will find it. Their service enabled me to do a much better job for my client.”

Tim Gabelhouse
, Attorney at Law

2014-11-11T18:20:41+00:00

Tim Gabelhouse
, Attorney at Law

“As an environmental law firm, we use Joe Dickerson to locate prior business owners and do corporate genealogies. He is persistent, that’s the key to a good investigator, and he has a knack for understanding how people move money and do business. That tells him what rocks to look under. Joe is vastly superior to other investigators in two ways: he lets you know what’s going on and he’s honest with you, because he tells you if there’s really anything there worth pursuing. He is unusually thorough and creative finding people. Joe has earned his fee every time.” “If the information is to be found, then I believe that they will find it. Their service enabled me to do a much better job for my client.”

“Joe spends the time to understand the problem from the client’s perspective and from the legal perspective. He is intelligent, tenacious, willing to work as hard as it takes, thorough, well-informed, and just awfully good at what he does.”

Thomas E. Root, 
Attorney

2014-11-11T18:20:05+00:00

Thomas E. Root, 
Attorney

“Joe spends the time to understand the problem from the client’s perspective and from the legal perspective. He is intelligent, tenacious, willing to work as hard as it takes, thorough, well-informed, and just awfully good at what he does.”

“Financial Forensic Services did an excellent job in the way they executed my case. They were very straightforward. They stated what they could do for us and they did it. And, from a personal standpoint, they are excellent. Both my wife and I felt very comfortable working with them.”

Michael Whalen, 
Businessman

2014-11-11T18:21:13+00:00

Michael Whalen, 
Businessman

“Financial Forensic Services did an excellent job in the way they executed my case. They were very straightforward. They stated what they could do for us and they did it. And, from a personal standpoint, they are excellent. Both my wife and I felt very comfortable working with them.”