Assets, Assets, Assets

Private Eye

The Investigation Newsletter for Attorneys

S p e c i a l E d i t i o n

Assets, Assets, Assets...

Everything You Ever Wanted To Know and

Some Things You Weren't Aware You Could Know

Over the last five years we have published many articles on asset investigations. In this issue of Private Eye we have distilled these articles into one comprehensive document that will give you everything you ever wanted to know about this subject, and more.

Asset investigations are needed in a
variety of legal matters. Initially they can be used to determine the financial viability of the opposing party. When a judgment has been rendered, they can be used to help collect the damages. In cases which involve punitive damages, they determine the potential amount of punitive damages. When there is insurance coverage and damages exceed the policy limits, they are used to determine if the defendant can satisfy the excess.

Where to Start
      In order to begin an asset investigation, an address and the correct spelling of the subject's full name are required. The address is necessary in order to eliminate multiple database matches and identify the owner of the subject's residence. If no address is known, the asset investigation should be proceeded by a locate search. It is helpful, but not necessary, to have the date of birth and Social Security number. Previously known addresses and descriptions of vehicles known to be owned should also be provided.
      Any aliases or AKA's (Also Known As) should be included at the time of assignment. It is helpful to include the name of the spouse and/or the maiden name of the subject, if applicable. In a case involving possible hidden assets, it is important to list the names of any known children, relatives and business associates in whose names the subject may be hiding assets.
            In the case of a business asset investigation, list both the physical address and the mailing address of the business at hand. Also provide information as to whether the company is a subsidiary of another corporation or entity and the names of any officers and the registered agent for service, if known. If possible, the Federal Employee Identification Number should also be provided.
            Asset investigations include various levels of inquiry. They start with public records searches for real property, vehicles, and business affiliations. From there they go to negative data such as bankruptcies, defaults, tax liens, judgments and pending litigation. Next comes searches for fianancial affiliaations and finally brokerage accounts, offshore accounts, and other such areas of inquiry. The level of inquiry is dictated by the nature of the case at hand.
The Basic Asset Search
            The type of information provided in an asset investigation starts with searches for real property and vehicles owned. It also includes inquiries into business affiliations such as fictitious business filings, corporate affiliations and limited partnerships. Another important area of inquiry is the Uniform Commercial Code index. This determines if the subject has listed business assets as collateral, if they have leases, and if there are pending judgments.
            The "bellwether" indicator of the asset profile is real property. In California this search can be conducted on statewide databases. Due to the large number of names on real property databases, it is important to have the correct spelling of the subject's name and a middle initial if possible. It is also helpful to know the subject's spouse's name to help determine which matches may be correct for the subject at hand.
    If the subject does not appear to own any real property, the next step is to conduct a search for the owner of the property where the subject lives. This may simply produce the name of an apartment landlord or absentee homeowner, or it may produce information linking the ownership of the property to the subject. This may reveal spousal ownership, or some other party associated with the subject.
    In California the ability of identify vehicles owned is limited. One must have the full correct name of the owner and the full address where the vehicle is owned. Unless both match exactly, no record will be produced.

The Bad News
            The next level of inquiry determines whether the subject has negative asset indicators such as bankruptcies, judgments, tax liens and any previous notices of default on mortgages. A search for prior or pending civil cases is also conducted. In addition, the subject's Social Security number, previous addresses, and year of birth are identified or confirmed. The given name and address for the subject is confirmed to insure that the correct data is being researched.
            A great deal of information can be obtained from the detail of a real property record. Additional co-owners are listed, and in most cases, both the site and tax bill mailing address of the owner are listed. The detail can supply information on the purchase date and price, and in some cases the mortgage holder and mortgage amount at the time of purchase. Also provided is information on the size of the property, the tax assessors parcel number and a description of the number of bedrooms, square footage, improvements, etc.
            In reviewing real property records it is important to note whether or not there is a homeowner's tax exemption on the property. If there is not, it is possible that the subject owns some other property on which they do claim a homeowner exemption. If a spouse or co-owner is listed on the property, it may be propitious to run additional inquiries in regard to such individuals.
            Next a search for professional or trade licenses is conducted. In addition, a search of the State Board of Equalization records is initiated to determine if the subject has a resale license. This can lead to the idenitrification of businesses not found in other databases.

Follow the Money
            The next level of inquiry includes a scan of consumer databases which determines all aliases, AKA's and sometimes the maiden name (if the subject has married within the previous few years). In addition, the year of birth, telephone number and Social Security number are verified or identified. We also determine whether the subject's Social Security number is valid and if the subject is using multiple Social Security numbers. In some cases the subject's employer is identified.
            A list of previous addresses for the subject dating back five to ten years is also obtained. A search of the owners of these previous addresses may provide new leads. We also conduct what is called a reverse property inquiry. On each property record there is a site address and a mailing address, the place where the owner receives their property tax bill. We are able to run a search of all property tax bills sent to any mailing address. This can turn up real property being concealed by the subject, by holding it in someone else's name, however the tax bill is sent to an address we know to be linked to the subject, often a P.O. Box. We also conduct a search for properties recently sold by the subject.
            At this level we conduct an investigation as to the equity in real property assets. This includes identification of encumbrances such as mortgages and trust deeds. We also conduct a survey of comparable real estate selling prices. The result is a determination of the current market and the amount of equity the subject is likely to have in the property.

Can You Bank O n It?
            To complete an asset profile, bank accounts are researched. Bank accounts are helpful in two ways. First they can give a general indication of the subject's level of cash liquidity. A substantial checking and savings balance, plus an IRA or two, gives an indication of a healthy asset profile.
            In addition bank accounts are very crucial in cases where there is already a judgment and you are ready to attach assets. It should be noted that subpoenas to attach bank accounts are served at individual bank or saving institution branches. The subpoenas cover all accounts in the subject's name at that branch only. They do not cover any accounts at other branches.
            Recent restrictions on obtaining information from financial institutions have made obtaining bank accounts more difficult and costly. Because of new laws, in many cases an institution can be identified, however the account number may remain illusive. It should be noted that the account number is not necessary for levying on an account, only name and the branch location is required. The new laws have made the process of getting bank accounts more labor intensive and therefore more expensive.
Ge t A Job
            Employment information is important in cases where judgments have been obtained. It can be crucial in domestic cases, such as investigating deadbeat dads. Although difficult to obtain, this information is available. A current address, phone number and Social Security number are usually necessary to obtain the employment data.
Cover Your Rear
            Often cases arise where you have an action against an individual who is covered by an insurance policy. If the insurance company offers to tender the policy, you are obligated to conduct an investigation into the assets of the subject. If you accept the policy limits, and at a future date your client learns that the defendant had significant assets that could have been sought, a malpractice suit could ensue.
The Messy Divorce
            Asset investigations can be crucial to a divorce case. Often parties to a divorce will attempt to divest themselves of known assets in order to hide and protect them. In some cases there has been hiding of assets for years. We can follow the trail of these assets. In this regard it is helpful to provide the investigator with as much information as is known on the nature of the assets.

Buried Treasure
So far we have discussed average types of asset investigations. Cases involving large amounts of money or hidden assets require further inquiries. The previously described inquiries often provide leads which deserve pursuit. This may include investigation into business associates, family members or friends. Additional areas of inquiry may include stocks and bonds, safe deposit boxes and offshore bank accounts. Discovery of such assets is expensive to obtain, however they are available.
The Bottom Line
Asset investigations are an important tool in a variety of legal matters. From deciding whether to pursue a case to collecting a final judgment, they are a good investment. They can save you and your client time and money. Using a qualified investigator to conduct your asset investigation will produce the desired effect on the subject: "You can run, but you can't hide (those assets)."

Bruce Robertson, President
Tristar Investigation