Meaning
Equitable orders compelling a third party bank to reveal the location of misappropriated funds enable the recovery of stolen property before it is dissipated. A bankers trust order targets the path of the money rather than the wrongdoer. It is used when there is clear evidence of fraud and a strong likelihood that the funds are held at a specific institution.
Information Traceability
The bank must provide account statements and transfer records that show where the money went after it left the victim’s control. A bankers trust order overrides the standard duty of confidentiality that a financial institution owes to its customer. This allows a claimant to follow the trail of assets through multiple jurisdictions.
Proprietary Justification
Use of this remedy is restricted to cases where the information sought is necessary to protect the claimant’s proprietary interest in the money. It does not allow for a general search through the financial history of the defendant. The court balances the need for disclosure against the privacy of the bank customer.
Cost Indemnification
Courts only grant this specific relief when other forms of discovery are insufficient to prevent the loss of the property. The bankers trust order requires the applicant to pay the costs the bank incurs while complying with the request. This ensures that the bank is not financially burdened by the dispute between the two main parties.
Legal fees for the bank’s counsel are typically covered by the applicant.
