TERRAELA OWES v. UNITED STATES OF AMERICA

Filing 8

ORDER ON MOTION TO PREVENT GOVERNMENT ACCESS TO FINANCIAL RECORDS dismissing without prejudice 1 Motion for Order By JUDGE JOHN A. WOODCOCK, JR. (CCS)

UNITED STATES DISTRICT COURT
DISTRICT OF MAINE
TERRAELA OWES
Petitioner,
v.
UNITED STATES OF AMERICA,
Respondent

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No. 2:23-mc-00292-JAW

ORDER ON MOTION TO PREVENT GOVERNMENT ACCESS TO
FINANCIAL RECORDS
A customer of a financial institution, facing investigation for potential fraud,
moves the Court pursuant to 12 U.S.C. § 3410 for an order preventing the
Government from obtaining access to her financial records. The Court dismisses the
motion without prejudice pursuant to 12 U.S.C. § 3410(a) because the customer failed
to meet the statutory requirement of showing either that the financial records sought
were not relevant to the legitimate law enforcement inquiry or that the Government
failed to substantially comply with the provisions of the Right to Financial Privacy
Act of 1978.
I.

BACKGROUND
The Government sent Terraela Owes a letter notifying her that her Paycheck

Protection Program (PPP) loans were being investigated for potential fraud.
Pursuant to the False Claims Act (FCA), 31 U.S.C. § 3729, et seq., the Government
issued a civil investigative demand to Ms. Owes and Bangor Savings Bank., a

financial institution associated with her, to determine whether Ms. Owes violated the
FCA through her participation in the PPP.
In response to these demands, on September 25, 2023, Ms. Owes moved the
Court “for an order preventing the government from obtaining access to [her]
financial records.” Mot. for Order Pursuant to Customer Challenge Provisions of the
Right to Fin. Privacy Act of 1978 at 1 (ECF No. 1) (Pl.’s Mot.). In support of her
motion, Ms. Owes submitted a sworn statement that claimed “there’s no legitimate
reason or purpose” for the financial records sought by the Government. Id., Attach.
1 at 1 (Owes Aff.).
On November 20, 2023, the Government filed a verified response to Ms. Owes’
motion. Gov’t’s Verified Resp. to Mot. for Order Pursuant to Customer Challenge
Provisions of the Right to Fin. Privacy Act (ECF No. 7).

In its opposition, the

Government argues that Ms. Owes “has failed to meet her initial burden of presenting
a prima facie case that Government access to her financial records would be
improper.” Id. at 1. Noting that Ms. Owes has merely stated that “there is no
legitimate reason or purpose” for the Government to access her financial records, the
Government maintains that this “uncorroborated assertion is conclusory, not
evidence,” and it “fails to meet the low threshold of showing that the Government’s
access may be improper.” Id. (quoting United States v. Kaimondre Owes, No. 2:23mc-00270-JAW, 2023 U.S. Dist. LEXIS 195715, at *4-5 (D. Me. Nov. 1, 2023)).
Ms. Owes did not file a reply to the Government’s response.

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II.

LEGAL STANDARD
The Right to Financial Privacy Act of 1978 (RFPA), 12 U.S.C. § 3401 et seq.,

the statute that Ms. Owes invokes, protects customers of financial institutions from
the government obtaining their financial records without adhering to certain
procedural safeguards and giving the customer both notice and an explanation of the
purpose of the inquiry. 12 U.S.C. §§ 3402, 3407-10. The RFPA also requires financial
institutions to certify compliance with the statute before releasing the customer’s
financial records. 12 U.S.C. § 3403(b).
The RFPA allows customers to challenge a government demand pursuant to
12 U.S.C. § 3410(a). To challenge the government demand successfully, the customer
must file a motion to quash or to enjoin the government from accessing the records
along with a sworn statement declaring the applicant is the relevant customer and
the applicant’s “reasons for believing that the financial records sought are not
relevant to the legitimate law enforcement inquiry,” that “there has not been
substantial compliance with the provisions of [the RFRA],” or both. 12 U.S.C. §
3410(a)(2); see Owes, 2023 U.S. Dist. LEXIS at *2-3.
When a customer files such a motion, courts determine if the “customer has
complied with subsection (a).” 12 U.S.C. § 3410(b). Compliance requires sufficiently
establishing some evidence that justifies a decision in the movant’s favor. H.R. Rep.
No. 1383, 9th Cong., 2d Sess. 53-54, 1978 U.S.C.C.A.N. 9273, 9325 (“all customers
need to do is make an initial showing that access may be improper . . . This section
does not require a detailed evidentiary showing . . .. However, it does require the

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customer to state facts to support his position”); Hancock v. Marshall, 86 F.R.D. 209,
210-11 (D.D.C. April 9, 1980) (“Indeed, the Court is left guessing . . .. The relevant
legislative history is clear in its intention to require adjudication of a customer’s
motion only when his affidavit present a prima facie case of impropriety”). Courts
agree that the movant “has the initial burden of presenting a prima facie case that
government access to his financial records would be improper.” Salm v. NLRB, No.
08-MC-0124(JS), 2009 U.S. Dist. LEXIS 62447, at *2 (E.D.N.Y. July 20, 2009)
(quoting Panaro v. United States SEC, No. 86-cv-4122, 1987 U.S. Dist. LEXIS 16810,
at *3-4 (E.D.N.Y. Aug. 4, 1987)); accord Galloway v. United States DOT Office of
Inspector Gen., No. 1:19-mc-0101, 2019 U.S. Dist. LEXIS 159070, at *10 (N.D. Ohio
Sept. 18, 2019); Owes, 2023 U.S. Dist. LEXIS 195715, at *3-4.
III.

DISCUSSION
Here, Ms. Owes filed a motion to enjoin the government from accessing the

records and submitted a sworn statement. While Ms. Owes’ statement confirms that
she is the relevant customer, it does not meet the latter two requirements. She offers
no suggestion that the government has failed to substantially comply with the
procedural safeguards of the RFPA. In fact, she leaves blank that part of her form
motion. Owes Aff. at 1. Ms. Owes also fails to present any evidence or argument that
she did not receive valid notification or is otherwise claiming that the government
failed to substantially comply with the RFPA.
This leaves Ms. Owes’ obscure assertion that the Government sent the
Customer Notice to her with “no legitimate reason or purpose.” Id. Beyond this

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uncorroborated declaration, Ms. Owes offers no facts or evidence to support her claim.
See H.R. Rep. No. 1383 at 9325. She therefore has not met “the initial burden of
presenting a prima facie case that government access to [her] financial records would
be improper.” Salm, 2009 U.S. Dist. LEXIS 62447, at *2; Owes, 2023 U.S. Dist.
LEXIS 195715, at *4-5.

Ms. Owes’ uncorroborated assertion is conclusory, not

evidence, and fails to meet “the low threshold of showing that the Government’s
access may be improper.” Owes, 2023 U.S. Dist. LEXIS 195715, at 4-5.
The Court, therefore, dismisses without prejudice Ms. Owes’ motion to prevent
the Government from obtaining access to her financial records.
IV.

CONCLUSION
The Court DISMISSES without prejudice Terraela Owes’ Motion for Order

Pursuant to Customer Challenge Provisions of the Right to Financial Privacy Act of
1978 (ECF No. 1).
SO ORDERED.
/s/ John A. Woodcock, Jr.
JOHN A. WOODCOCK, JR.
UNITED STATES DISTRICT JUDGE
Dated this 15th day of December, 2023.

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