California Code of Regulations › Title 2 - Administration › Division 7 - Secretary of State › Chapter 12 - Victims of Corporate Fraud Compensation Fund › Section 22502 - Additional Application Documentation or Information

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) If the final judgment does not contain a
				specific finding of fraud, misrepresentation, or deceit made with intent to
				defraud, the claimant shall provide additional documentation supporting the
				claim of fraud against the judgment debtor, including evidence submitted to the
				court to obtain the underlying judgment or a detailed narrative statement of
				facts explaining the allegations of the complaint.
(b) If the final judgment does not expressly
				set forth the amount of damages that were awarded for actual loss and
				compensatory damages that are payable from the fund, the verified application
				shall include copies of documentation supporting the amount of the actual and
				direct loss. For purposes of this section, sufficient proof of actual and
				direct loss may include copies of bank account statements showing or confirming
				particular transactions, copies of the front and back of checks made payable to
				the judgment debtor that have been negotiated, credit card statements showing
				or confirming particular transactions, or similar documentation demonstrating
				financial loss directly resulting from the fraudulent acts by the judgment
				debtor.
(c) The verified
				application shall include a description of searches and inquiries conducted by
				or on behalf of the claimant with respect to each defendant's assets available
				to be sold or applied to satisfaction of the judgment, including copies of
				documentation proving that the claimant has sufficiently pursued collection
				efforts against all judgment debtors and all other persons liable to the
				claimant for the fraud that is the basis for the underlying judgment. For
				purposes of this section, "sufficient collection efforts" may include filing
				abstracts of judgment in counties where the judgment debtor may have assets,
				filing a notice of judgment lien, conducting one or more debtor exams in order
				to identify and locate assets, obtaining writs of execution and levying upon
				assets, or other attempts to find and attach assets for collection. In the case
				of a bankruptcy, sufficient collection efforts may include participating in the
				bankruptcy proceedings to protect the debt from discharge or to protect the
				right to proceed with a civil suit or other collection efforts, or other types
				of activities to protect and proceed with collection efforts. In the case of a
				corporate bankruptcy, sufficient collection efforts may include protecting the
				right to proceed with a civil suit or to proceed with other collection efforts,
				participating in any distributions of assets set up by a receiver or other
				court appointed liquidator of available assets, or other types of activities to
				protect and proceed with collection efforts. A court's determination or finding
				of the judgment debtor insolvency or lack of assets may be submitted in
				satisfaction of this requirement.
(d) If the final judgment was obtained by
				default, by stipulation or consent, or was obtained pursuant to Code of Civil
				Procedure section
				594,
				or was defended by a trustee in bankruptcy, the Secretary of State may request
				that the claimant provide additional documents and information including, but
				not limited to, the following:
(1) An
				explanation of the computation of the amount of the claim, including an
				itemization of all sums recovered from any source applied to the satisfaction
				of the judgment. The itemization shall identify the person or entity from which
				the sum was obtained, the manner in which the recovery was obtained, and sum of
				the recovery.
(2) A certified copy
				of the final judgment entered by the court.
(3) A copy of the civil complaint upon which
				the judgment for intentional fraud was issued, if applicable. If one or more
				amendments or amended complaints were filed, a copy of all amendments and all
				prior versions of the complaint. The copies should be endorsed by the clerk of
				the court or bear other evidence that they are a copy of the actual document
				filed with the court.
(4) A copy of
				the notice of entry of judgment, if any, or clerk's certificate of mailing, if
				any. If the matter was submitted to arbitration, a copy of the arbitration
				decision. If the original judgment was appealed, copies of the appellate
				decision and remittitur.
(5) Copies
				of any findings of fact, conclusions of law, jury verdicts, jury special
				verdicts, statements of decision, memorandum decisions, or any other indication
				by the court or jury, as the case may be, of its decision on the issue of
				intentional fraud and the reasons for the decision. If the matter was submitted
				to arbitration, all documentation submitted to the arbitrator or arbitrators
				supporting the arbitration award. If the application is based on a criminal
				restitution order, a copy of the criminal complaint or criminal indictment and
				any other pleadings, orders and documentation supporting the criminal
				restitution order.
(6) A
				description and itemization by the claimant of the basis for each element of
				damages or restitution awarded.
(7)
				A listing of all persons and entities that might be potentially liable to the
				claimant for the fraud that is the basis of the civil judgment, arbitration
				award, or criminal restitution order and if any person or entity was not named
				as a defendant or was dismissed from the underlying lawsuit, or if any person
				or entity was not a party to the arbitration or was dismissed from the
				arbitration of the claims that are the basis of the underlying arbitration
				award, a statement of the reasons for failing to pursue a person or entity
				potentially liable to the claimant for the fraud that is the basis of the civil
				judgment, arbitration award, or criminal restitution order.
(8) Copies of any pre-trial or post trial
				motions, briefs, settlement conference statements, orders or rulings or briefs
				submitted in arbitration by any party.
(9) Copies of the answer, cross-complaints,
				answers to cross-complaints, and all amendments or other subsequent versions of
				any of those documents.
(10) Copies
				of all depositions, interrogatories, requests for admission, and other
				discovery taken in the underlying action by any party, describing the party or
				parties taking the deposition(s), the party propounding the interrogatories,
				the party propounding the requests for admission, or the party propounding the
				other discovery requests, the deponent(s), the party responding to any
				discovery request.
(11) A list of
				the names of any witnesses who testified at the underlying trial, or
				arbitration of the claims that are the basis of the underlying lawsuit,
				arbitration award or criminal restitution order and the present or last known
				addresses of the witnesses to the extent known by the claimant.
(12) If the claimant claimed any loss related
				to the fraud as a deduction on the claimant's tax return or returns, a
				description of the amount of the tax benefit derived
				therefrom.