Monday, June 18, 2012

What Happened to My Office on August 6, 2011

     I stopped at Gator Garage on 16th Avenue to fill my gas tank on the way to my clinic.  My credit card didn't work.  I didn't have enough cash.  I tried my ATM card.  It was rejected.  I wrote a check.  Later, all my checks bounced.
     I had a personal account at Campus USA Credit Union.  I had a business account for my medical clinic at M & S Bank.  Both are small, local institutions with a reputation for personal attention: neighborly, smiley, attentive...unless you have a problem.
     My account at Campus USA Credit Union went back 18 years.  Most of my personal bills were paid automatically out of this account.  I had been doing business at M & S Bank for 12 years and for most of that time kept an average daily balance of $400,000, the amount needed to cover payroll and bills at the clinic for a month or two.  
     My clinic was staffed by almost 30 employees;  health insurance was covered;  in the past, a 401K and Defined Benefit Plan were funded as retirement plans for employees after one year.  Everyone had paid time off.  Medical clinics are expensive to run.  
     M & S does not have a mechanism for accruing interest on the money in a business bank account without the owner running the risk of overdrawing.  This is good business for the bank, and bad for the customer.  Therefore, the bank had an interest in keeping my account, as it profited from the deposits. 
     But banks are apprehensive, like bad lovers.  It doesn't matter how long you've known them, they're always looking out for themselves.
     Prior to August 6th everyone at both banks had been charming and helpful.  I almost never needed any help and I didn't complain or pester them.  In fact, I almost never went to the bank.  A designated employee made clinic deposits at the drive-through window every day.  We paid bills by check or by automatic withdrawal.
     The Credit Union said they couldn't see a problem with my credit card.  There had been no "irregular activity."  
     On August 7th my credit card still didn't work.  I called the hotline to make sure the number hadn't been confiscated.  Answer:  "No."  
     On August 8th I took myself to both institutions, because I couldn't get answers by phone.  At M & S there was a strange atmosphere in the lobby when I walked in.  Thick, queer, humid.  I was the only customer.  There was none of the usual enthusiasm and handshakes.
     "Hello," I said.  Someone nodded at me.
     "My bank balance says zero,"  I told the teller.  "Something must be wrong.  We make deposits every day.  It can't be zero."
     "Let me check...."  Several long minutes passed.  There was a private discussion behind the bullet-proof plexiglas.  "I'm sorry, but the computer says it is zero.  You need to speak to a manager."
     The manager informed me that all the money had been removed from the clinic account.  An IRS official named Special Agent Dylon J. Curatolo had come in very importantly and presented the bank with a Seizure Warrant from the Northern District of Florida, signed by Magistrate Judge Gary Jones. It permitted the IRS to write a check for the entire balance in the account, and withdraw it.  The IRS agent was acting, it turns out, on behalf of the FBI.
     I called my accountant who had submitted tax returns for the Clinic for the last 6 years.  She called the IRS for me.  There were no IRS problems--no unpaid taxes, no liens.  She was perplexed. 
     I asked for a copy of the Seizure Warrant but the bank manager said it wasn't available.  They would have to send it to me.  "How do you expect me to run my business without money in the bank?"  I asked.  No answer.  The frigid looks all around made it clear that a loan would be out of the question.  I made them uncomfortable.  Overnight I had become a criminal in their eyes, these people who had on many occasions offered to give me loans or assist in a multitude of ways, and who had acted like real pals.  Of course, I hadn't ever needed a loan from them before.  I hadn't needed assistance either, until now.  
     It is difficult to like banks.  I know they must be necessary for the smooth functioning of a complex society like ours.  Everyone, even the most reclusive among us, seems to have a bank account.  But banks work in a topsy-turvy way.  When you don't need money, they are enthusiastic about loaning it to you.  When you do need money, they are not willing to loan it, not a penny.  
     When I completed residency training in 1993 and moved to Florida to start a job I would have liked to open a solo practice right away.  I went to the M & S branch in Hawthorne to request a loan.  I explained my goals and was ready to present the manager with a formal business plan.  But he wouldn't hear of it.  I owed more than $200,000 in student loans.  I had no collateral...unless one were to consider my medical degree--something a person could use to earn money--as collateral.  
     They didn't.  "Come back when your debts are paid," they said.  "And when you have money in the bank.  Then we'll talk."  We shook hands in the most jovial way.  I understand their caution.  But banks weren't always like this.  In 1956,  just out of medical school, my father had no collateral.  Yet he obtained loans with a handshake from the local bank for a medical office, a house, and a new Cadillac.  "No problem," they said to him in the same jovial manner.
     I told myself:  I will never do business with these people again.  
     But 6 years later I did open a bank account at M & S for my new clinic in Hawthorne.  It was the only bank in town.  In fact, it was the only bank within a 15-mile radius.  What choice did I have?  Medicare, which covers 50% of the patients in Hawthorne, does not pay by any method except direct deposit into a bank account.  A doctor who takes Medicare must have a bank account to receive automatic deposits.  Medicare doesn't write checks.   
     In brief, the FBI took $288,000 from my clinic's M & S Bank account;  $98,706.20 from my Campus USA personal checking account;  and $30,333.71 from my Campus USA personal savings account.  I had zero liquid assets.  I had to meet payroll for my staff in a week.  The following month I needed to make our usual quarterly tax payment.  The clinic had outstanding bills, which were usually paid weekly.
     Now M & S Bank wanted to close my account.
     "Please don't do that," I implored them.   My office will remain in business, and make more deposits."  But I couldn't be sure the government wouldn't take every dollar the Clinic earned from that point forward.  Neither could the bank.  
     Campus USA Credit Union closed my credit card account.  I still owed a large balance, as the card was used for Clinic medical supplies each month, and the monthly balance wasn't due for another week.  Visa was always paid automatically each month, in full.  I was unable to persuade the Credit Union to allow only the minimum balance, rather than the full balance, to be withdrawn automatically in a week. "We don't have enough lead time," the teller said. "You need to give us at least a month."  
     "Can't you just pick up the phone and explain the situation?  My bank accounts were drained.  I don't know why."
     "Sorry," I was told.  The bank was unable, "automatically," to pay the full balance out of my account one week later, because the people in charge had no power to put a hold on the computerized auto-pay.  What glaring proof that computers have superseded humans!  I was now in default on the Visa account, having "bounced" an automatic payment I had tried for two weeks to annul.
     Why was money confiscated from all my bank accounts?  No one could tell me.  When I finally obtained a copy of the Seizure Warrants for the three accounts, there was nothing substantive in them to explain the seizures.  
     A statement in the Seizure Warrant said, "Certain property in the name of Colasante Clinic is property constituting or derived from proceeds obtained directly or indirectly from violations of Title 18, United States Code, Section 1956(c)(7), and subject to forfeiture pursuant to Title 189 United States Code, Sectiion 981(a)(1)(C)."  
     I looked up these codes.  "Fraud."  "Money Laundering."  What were they talking about?  
     My lawyer informed me, "Those codes don't tell us anything.  They are codes the government always uses to do what they do when they do things like this."
     My head was spinning.  I didn't know how to proceed.  So much needed to be done, and doors were closing all around me.

2 comments:

  1. IDK I DON'T THINK YOU ARE A FRAUD AND THE GOVERNMENT IS CORRUPT , NEVER KEEP THE BULK OF YOUR MONEY IN THE BANK - YES YOU NEED A BANK TO RUN A BUSINESS ONLY KEEP WHAT YOU NEED TO KEEP IN THE BANK . FIND ANOTHER WAY TO KEEP YOUR BULK CASH BUT DO IT SAFELY WHERE YOU DON'T LOOSE IT AND YOU SHOULD TREAT YOUR PATIENTS BETTER ... DANIEL MORRIS

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