United States District Court, D. Colorado
KRISTEN L. MIX UNITED STATES MAGISTRATE JUDGE.
matter is before the Court on the Customer's
Motion to Quash Subpoena of Financial Information
[#148],  filed by Tracy S. VanCura (“Ms.
VanCura”) (“Ms. VanCura's Motion”), and
on the Customer's Motion to Quash Subpoena of
Financial Information [#149], filed by Defendant
James Bryan VanCura (“Defendant J. VanCura”)
(“Defendant J. VanCura's Motion”)
(collectively, the “Motions”). The United States
filed a combined Response [#151], opposing the Motions; Ms.
VanCura and Defendant J. VanCura did not file Replies. The
Court has reviewed the Motions [#148, #149], the Response
[#151], the case record, and the applicable law. Accordingly,
the Court is fully advised in the premises. For the reasons
set forth below, the Motions [#148, #149] are
February 28, 2008, the United States sued Defendant J.
VanCura and two others not at issue in the present Motions,
alleging, in part, that Defendant J. VanCura failed to honor
an Unconditional Guarantee of a note securing a defaulted
Small Business Administration Loan. Compl. [#1]
¶¶ 102-110. As part of a Stipulated Settlement
Agreement, Defendant J. VanCura executed a Consent Judgment
obligating Defendant J. VanCura to pay the United States $1,
310, 000, with post-judgment interest. Stipulated
Settlement Agreement [#67] ¶ 13; Consent
Judgment [#77] at 1. After Defendant J. VanCura breached
the Settlement Agreement, the Court entered the Consent
Judgment. Am. Motion for Order Entering Consent
Judgments [#72] at 5; Order [#75] at 3-4.
Although the United States sent Defendant J. VanCura a
payment plan, Defendant J. VanCura failed to make a payment.
Response [#151] at 2 ¶ 7; Pl.'s Ex.
3 [#151-3]. Through the Treasury Offset Program, the
United States applies 15% of Defendant J. VanCura's wages
to Defendant J. VanCura's debt. Response [#151]
at 2 ¶ 7 n.1. Approximately $1, 000, 000 of Defendant J.
VanCura's debt remains unpaid. Id. at 3 ¶
9; Pl.'s Ex. 6 [#151-6]. Defendant J. VanCura
has not complied with the United States' discovery
requests, nor has Defendant J. VanCura provided the United
States with updated financial information since August 2012,
despite the United States' request. Response
[#151] at 2 ¶ 7, 3 ¶ 8; Pl.'s Ex. 5
November 2018, Provident Funding Associates, LLP
(“Provident”) informed the United States of
Defendant J. VanCura's attempts to refinance the mortgage
on Defendant J. VanCura's property at 7311 Sylamore Way,
Falcon, Colorado 80831 (the “Falcon Property”).
Response [#151] at 3 ¶ 10. As part of a
potential refinancing, Provident asked the United States to
subordinate its lien on the Falcon Property to
Provident's loan. Id. The United States agreed,
subject to several conditions. Id. Thereafter,
Provident provided the United States with a copy of the Loan
Estimate, reflecting Provident's compliance with the
United States' conditions. Id. at 3 ¶ 11;
see also Pl.'s Ex. 7 [#151-7]. Alongside
Defendant J. VanCura, the Loan Estimate identifies Ms.
VanCura as an applicant. Pl.'s Ex. 7 [#151-7] at 7.
the Loan Estimate with Defendant J. VanCura's most recent
Financial Statement of Debtor (“Financial
Statement”), the United States noticed that Defendant
J. VanCura provided different addresses. Response
[#151] at 3 ¶ 11; Pl.'s Ex. 2 [#151-2].
While the Loan Estimate provides the Falcon Property's
address, the Financial Statement instead provides 11815
Murphy Road, Elbert, Colorado 80106 (the “Elbert
Property”). Pl.'s Ex. 2 [#151-2] at 1. The
Court notes the Motions also provide the Elbert
Property's address. Defendant J. VanCura's
Motion [#149] at 2; Ms. VanCura's Motion
[#148] at 2. Corresponding with Provident, the United States
inquired whether Defendant J. VanCura actually resides at the
Falcon Property and whether Defendant J. VanCura disclosed
any other assets during the course of Defendant J.
VanCura's attempts to refinance the Falcon Property's
mortgage. Pl.'s Ex. 8 [#152-8] at 2. The United
States received a reply stating only that Provident could not
proceed with refinancing the Falcon Property's mortgage.
Response [#151] at 4 ¶ 12; Pl.'s Ex.
8 [#151-8] at 1.
to clarify Defendant J. VanCura's financial condition and
asset holdings, the United States issued a Subpoena,
directing Provident to produce “[a]ll records related
to the refinancing of the mortgage for property located at
7311 Sylamore Way, Falcon, CO 80831, on or about November
2018.” Response [#151] at 4 ¶ 13;
Pl.'s Ex. 9 [#151-9] at 1, 4. Since the Loan
Estimate identifies Ms. VanCura as an applicant and Provident
may, therefore, incidentally disclose Ms. VanCura's
financial information in responding to the Subpoena, the
United States sent Ms. VanCura a copy of the Subpoena and the
required Right to Financial Privacy Act (“RFPA”)
notice (“RFPA Notice”). Response [#151]
at 4 ¶ 13; Pl.'s Ex. 7 [#151-7] at 7;
Pl.'s Ex. 9 [#151-9] at 1-5, 9-13; 12 U.S.C.
December 2018, Ms. VanCura and Defendant J. VanCura filed the
Motions, moving to quash the Subpoena under the RFPA's
“customer challenges” provisions, 12 U.S.C.
§ 3410, and citing “the financial institution
[sic] rejection of my application of mortgage rate
adjustment” and “[t]he request for rate
adjustment was denied, ” respectively. Ms.
VanCura's Motion [#148] at 2; Defendant J.
VanCura's Motion [#149] at 2. The United States
filed a combined Response [#151], opposing the Motions; Ms.
VanCura and Defendant J. VanCura did not file Replies.
Federal Debt Collection Practices Act (“FDCPA”),
codified at 28 U.S.C. §§ 3001-3308 (2018),
provides-to the extent not inconsistent with another Federal
law-the “exclusive civil procedures for the United
States . . . to recover a judgment on a debt.” 28
U.S.C. § 3001(a)-(a)(1). According to the FDCPA, the
Court may enforce a judgment against “[a]ll property in
which the judgment debtor has a substantial nonexempt
interest, ” id. § 3203(a), defining
“property” to include “any present or
future interest, whether legal or equitable, in real,
personal (including choses in action), or mixed property,
tangible or intangible, vested or contingent, wherever
located and however held.” Id. §
in execution against the judgment debtor, the “United
States may have discovery regarding the financial condition
of the debtor in the manner in which discovery is authorized
by the Federal Rules of Civil Procedure in an action on a
claim for a debt.” Id. § 3015(a). Federal
Rule of Civil Procedure 69(a), in turn, permits
“discovery from any person-including the judgment
debtor-as provided in these [R]ules.” Although the
RFPA, codified at 12 U.S.C. §§ 3401-3423 (2018),
establishes specific procedures the United States must follow
to obtain information from a financial institution about a
customer's financial records, the RFPA also reinforces
the FDCPA's discovery provisions, expressly exempting
from RFPA protections financial records “sought by a
Government authority under the Federal Rules of Civil . . .
Procedure or comparable rules of other courts in connection
with litigation to which the Government authority and the
customer are parties.” 12 U.S.C. § 3413(e).
relevant here, the RFPA permits the United States to obtain
from a financial institution a non-party customer's
financial records, pursuant to a subpoena, if “such
subpoena is authorized by law and there is reason to believe
that the records sought are relevant to a legitimate law
enforcement inquiry.” Id. § 3407(1);
see, e.g., Fed. Trade Comm'n v.
Kutzner, No. SA CV 16-00999 BRO (AFMx), 2016 WL 9282403
(C.D. Cal. Nov. 16, 2016); Neuhaus v. SEC, No. MISC
07-0025 FCD GGH, 2007 WL 1322340, at *2 (E.D. Cal. May 4,
2007) (“RFPA is the exclusive means by which
‘government authority' can acquire financial
records of a non-party ‘customer' (individual) via
a judicial subpoena from a ‘financial institution'
. . .. [O]rdinary discovery rules apply to parties in an
obtain from a financial institution a non-party
customer's financial records, the United States must
provide the customer with a copy of the subpoena, a
“notice . . . stat[ing] with reasonable specificity the
nature of the law enforcement inquiry, ” and
opportunity to object. 12 U.S.C. § 3407(2)-(3). To
object to the United States' subpoena, a customer must
comply with several procedural provisions such as, within
“ten days . . . from the date of service or fourteen
days from the date of mailing of the notice, ” filing
“a sworn statement and motion to quash in an
appropriate court.” Id. § 3407(3). The
“sworn statement” must state “that the
applicant is a customer of the financial institution from
which financial records pertaining to him have been
sought” and “the applicant's reasons for
believing that the financial records sought are not relevant
to the legitimate law enforcement inquiry stated by the
Government authority in its notice, or that there has not
been substantial compliance with the provisions of [the
RFPA].” Id. § 3410(a)(1)-(2). The
statutory template for the RFPA Notice also invites the
customer to provide “any other legal basis for
objecting to the release of the records.” Id.
Court finds that “the applicant is the customer to whom
the records sought by the Government authority pertain, and
that there is not a demonstrable reason to believe that the
law enforcement inquiry is legitimate and a reasonable belief
that the records sought are relevant to that inquiry, or that
there has not been substantial compliance with the provisions
of this chapter, it shall order the process quashed.”
Id. § 3410(c); see, e.g., Penalosa
v. Dep't of Defense, No. 15-mc-00049-RM, 2015 WL
1598088, at *3 (D. Colo. Apr. 8, 2015) (denying motion to
quash after finding “there is a demonstrable ...