Posted on Jul 07, 2011
Bank let pair draw son’s settlement
July 6, 2011
Since a 2010 World-Herald investigation revealed shortcomings in the court oversight of wards, authorities have scrutinized the guardians, lawyers, even judges who failed to protect the finances of people who can’t protect themselves.
Now a lawsuit is targeting another cog in the preservation of a ward’s assets: the bank.
An Omaha attorney has filed a lawsuit against First National Bank for allowing a couple to withdraw $48,000 a settlement that was supposed to go to their son, a gunshot victim.
The problem: The account was stamped with the note “no withdrawals without court approval” and the judge hadn’t granted such permission.
The next problem: Neither the judge nor court staff noticed that the account was empty for more than a year.
Omaha attorney Thomas Harmon is trying to recover the money on two fronts in the case that began with the shooting of a 2-year-old boy.
First, Harmon has secured a judgment against the boy’s parents, former Omaha residents Blia and Sy Vang.
Second, Harmon has taken aim at the bank that allowed the lump-sum withdrawal.
While much attention has been given to the court-appointed guardians who have stolen from the people they were appointed to protect, judges and lawyers say they are much more likely to find finagling among family members.
Harmon said parents in particular often feel they have a right to their child’s money.
“You’ll have people say ‘Why can’t I take the money? My kid needs a car,’” Harmon said. “Well, the answer is simple: ‘It’s your child’s money, not yours.’”
“In these cases, that money may be for a surgery down the road or to replace the child’s lost earning capacity. It isn’t to supplement mom and dad’s income.”
First National Bank spokesman Kevin Langin declined to respond to the lawsuit, saying the bank “does not comment on issues regarding customer accounts or on matters involved in litigation.”
Harmon, who has worked in probate court for more than 20 years, said such cases are rare but not unprecedented.
Ten years ago Harmon sued U.S. Bank after a father emptied more than $100,000 from his son’s account without court authorization. The father later admitted he used the money to feed his cocaine addiction, Harmon said.
It’s unclear what the Vangs did with the $48,000. The couple, whose last known address was in Coon Rapids, Minn., couldn’t be reached for comment.
According to court documents:
On July 15, 1995, the Vangs had gathered with about 50 family members to celebrate a graduation at a house in rural Beatrice, Neb. Four toddler boys, including Noushelong Vang, found three shotguns in their grandfather’s closet.
Noushelong grabbed the barrel of one gun when a cousin pulled the trigger. The gun went off, sending quail shot directly into Noushelong’s stomach.
The 2-year-old survived.
Within two years the Vangs reached a settlement through the homeowners’ insurance policy of Noushelong’s grandfather.
In addition to paying off $5,000 in medical bills and $10,000 in attorney fees, the settlement called for:
» One payment of $35,000 to Blia and Sy Vang for any hardship or “continuing” medical expenses their son might incur. That sum was separate from payments made to their son.
» Two payments of $39,911 to Noushelong Vang, to be delivered on October 2002 and October 2007.
To protect the sums that were meant for the child, an attorney set up a conservatorship case in Douglas County Probate Court.
A judge appointed Blia and Sy Vang to be conservators of their son’s settlement. Their marching orders included the following admonition, standard in most conservatorship cases: “You shall not pay yourself compensation from the assets or income of your ward without first obtaining an order.”
The judge went even further. He said the settlement “shall be deposited directly” into a bank account, and there were to be “no withdrawals without a court order.”
The Vangs and the bank initially followed the judge’s order.
Under the “remarks” section of the account, First National attached the following note: “W/D (withdrawal) by cour (sic) order only.”
Every summer from 2002 to 2008, bank officials issued reports to the court showing a gradual gain. The nearly $40,000 from 2002 had become $48,238 by 2008.
Then, Harmon said, “It disappeared.”
On Aug. 27, 2008, the lawsuit says, the Vangs “requested and received” a cashier’s check for $48,181. The bank issued the check without a court order, Harmon said.
On June 16, 2009, a bank official sent the required annual report to the court. It showed that the account had a balance of zero.
Despite that, neither court employees nor the judge who took over the case Joseph Caniglia called for an inquiry into the empty account for more than a year.
In September 2010, court staff sent notice to the Vangs’ last Omaha address, asking for an accounting. The mailing came back marked “return to sender.”
In November, Caniglia appointed Harmon to try to track down the money.
A Minnesota sheriff trying to serve a lawsuit on the Vangs reported that he heard people inside the home the Vangs had listed as their address, but no one would come to the door.
Harmon said he doesn’t know whether any of the money remains. Also unknown: What happened to the second $39,000 settlement payment Noushelong Vang was supposed to receive in 2007? All of those matters are certain to come to a head in the next year.
Noushelong Vang is less than a year from his 19th birthday typically the age that the courts turn over settlements to their intended recipients. The teen likely will be entitled to the money, Harmon said, even if authorities determine that his parents took it improperly.
“Some parents look at it as an extra investment account,” Harmon said. “Their intentions aren’t always nefarious; maybe they’re in a bind.
“But that money isn’t theirs. If their child has legitimate needs, they have to go through the court. Everything has to be transparent.”