U.S. Sen. Dianne Feinstein, who lost millions of dollars in political donations to what the FBI has labeled embezzlement, on Friday sued the campaign treasurer she says stole the money — and the bank she contends should have noticed the theft.
The lawsuit aims to get a full accounting of what happened with the campaign's accounts over the past five years, and to reimburse the campaign, with interest, for the money it says was stolen.
As TheWrap reported earlier this month, Hollywood donors, including contributors at Sony, Disney, News Corp. and the Motion Picture Assn. of America, were among those who gave to Feinstein.
Millions of dollars in contributions were stolen, Feinstein and the FBI say.
Southern California Congresswoman Susan Davis dubbed Kinde Durkee, the woman accused of the embezzlement, “the Bernie Madoff of campaign finance treasurers.”
Also read: Hollywood Donors Hit in Campaign Embezzlement Scandal
In the lawsuit, filed in Superior Court in Los Angeles on Friday, Feinstein for Senate and her Fund for the Majority Committee sued Durkee, who was arrested by federal agents Sept. 2 on mail fraud charges.
Feinstein also sued First California Bank, which the lawsuit says "was at the heart of the illegal transfer of money."
According to the lawsuit, "First California Bank intentionally ignored dozens of red flags, ignored its duties and obligations under state and federal law and allowed Durkee to perpetuate the scheme."
Read the lawsuit here
Durkee started working as Feinstein's campaign treasurer in 1992, and has worked on each reelection campaign since then.
Court documents show that Durkee and her Durkee & Associates were trusted and well-regarded, but that "for years, Durkee and others took advantage of their positions of trust … to secretly siphon off money that was intended to support causes that are important to the American people."
The documents say that Durkee "used the Feinstein Committees' money to cover her personal and business expenses, and to reimburse other elected officials' campaign funds from which she had also embezzled."
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Over the last two years alone, the lawsuit says, Durkee and her co-defendants "stole millions of dollars from at least two of Senator Feinstein's campaign committees … Investigators are still working to determine the full extent of the harm."
An FBI investigation determined that Durkee used the money "to pay her personal expenses, including mortgage payments and American Express charges, as well as business expenses."
Meanwhile, the lawsuit says, Durkee phonied up bank statements.
The lawsuit says the bank should have noticed — and stopped — the alleged fraud.
"Monitoring and reporting suspicious activity is a critical and routine function of modern banks, and guidelines for identifying suspicious activity abound," the lawsuit says.
By suing the bank, which presumably has deeper pockets than Durkee, the campaign is targeting an institution that may have the wherewithal to actually repay the funds.
A spokesman for the bank did not return a message for comment Friday.