Sen. Dianne Feinstein's Suit Against Ex-Treasurer Kinde Durkee Delayed, As FBI Pursues Fraud Investigation

By Gene Maddaus Mon., Nov. 21 2011 at 2:10 PM

Dianne Feinstein

Sen. Dianne Feinstein has sued her former treasurer, Kinde Durkee, alleging that Durkee embezzled millions from her campaign accounts. But as the FBI continues to build its criminal case against Durkee, Feinstein's lawsuit has been put on hold.

This morning, Judge Richard Neidorf granted Durkee's request to postpone her deposition indefinitely. Durkee's attorney had argued that allowing the civil case to proceed while federal charges are still pending would violate her right against self-incrimination.

The delay makes it less likely that Feinstein, or any of Durkee's other victims, will get any of their money back before the 2012 election.

Feinstein's attorney, Justin Berger, argued against the delay.

"Every day that passes, the less likely it is the funds will be found," he said.

Feinstein appears to have lost nearly $5 million, making her by far the biggest victim of the Durkee scandal. She is up for re-election next year, and has already written her campaign a $5 million check to cover her losses.

Durkee was arrested on Sept. 2 and charged with embezzling nearly $700,000 in campaign funds from Assemblyman Jose Solorio.

In addition to delaying Durkee's deposition, Judge Neidorf also postponed the deposition of her husband, John Forgy. Though Forgy has not been charged, he remains under FBI investigation, his lawyer said.

Neidorf did allow Feinstein's attorneys to proceed with their case against First California Bank, which is where Durkee kept most of her accounts. Feinstein's lawsuit alleges that the bank failed to catch numerous red flags, and therefore should be liable for the losses.

First California's attorney, Lance Etcheverry, argued that the bank will be at a disadvantage if it cannot question Durkee about her activity.

"The bank won't have a fair trial without Durkee speaking," Etcheverry said. "How would we know which transactions were legitimate and which weren't?"

But Judge Neidorf disagreed. Since the bank is not under a criminal investigation, Neidorf allowed Feinstein's lawyers to go ahead and question bank officials about their handling of the Durkee affair.

Etcheverry said the bank would soon file a motion to dismiss Feinstein's lawsuit.

Durkee is due for a preliminary hearing in federal criminal court in Sacramento on Dec. 9. The lawsuit is due back in court for a status conference on Feb. 21.

Tags:

Democratic Party, Dianne Feinstein, embezzlement, fraud, Kinde Durkee

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ruck s

Politicians are use to being the Stealer not the Stealee. It really is very amusing ! No sympathy for Diane on this one. The polititions taught Kinde too well !

Sante

Hope Feinstein gets the money back, theifs are sent to prison, and the Judge learns how to be fair and impartial or retire. Probably too old to learn now, just retire already.

Fifthavenue810

First of all, the money wasn't Dianne Feinstein's money to begin with, it was her campaign Donors money. Dianne Feinstein has nobody to blame but herself for not properly checking her campaign treasurer for the past 20 years, I think it is rather hipocritical of her to call First California Bank Greedy when she was the one getting a bargain by paying low fees to manage her campaigns by Kinde Durkee. I liken her lack of accepting responsibility to that of Former US Senator and NJ Govenor Jon Corzine telling Congress that He doesn't know where the 1.2 Billion Dollars of missing client money went. Dianne Feinstein is old enough to know that "If it sounds too good to be true, it probably is". First California Bank should not be held responsible for Dianne Feinsteins own ignorance.

boarder75

I hope FCB gets the bejesus sued out of them. As a former employee I've seen firsthand what kinds of transactions are frequently overlooked for "good" customers.

Frawsty

Dianne Feinstein is a good example of what is wrong with Washington. It is time to vote out this wrinkly old crook. She obviously doesn't do a very good job watching her campaign finances, imagine what she does with our tax dollars.

Fifthavenue810

Frausty, you could not have said it any better, especially "Time to vote out this wrinkly old crook". Thats Dianne Feinstein in a nutshell "Wrinkly Old Crook"