Deposition of John Brough — Blue Flame Medical LLC v. Chain Bridge Bank, N.A. (E.D. Va.)
Factual Summary
Brough enumerates, question by question, the facts he says he considered "red flags" around the Blue Flame account and wire: late disclosure of the dollar amount to the customer's own colleague; Gula's failure to supply documentation Brough and Evinger requested by phone and follow-up email; Gula's unusual in-person account opening; his visible urgency; his post-opening calls asking whether the wire had arrived, before volunteering the amount; the client's stated intent to move the money back out quickly via a multipart transfer ending in China; and personal remarks that the wire was Gula's "payday," that he would be unreachable, and that he was shutting down his D.C. office. Brough also testifies that a JPMorgan contact he identifies as "Koipal" (an OCR-garbled court-reporter rendering) told him JPMorgan's investigation "was not leading to good places," itself treated as a red flag. Brough confirms he had all of these facts in mind "at the time that JPMorgan recalled the wire."
Key Facts
- Brough's red-flag list: late disclosure of the dollar amount, Gula's undocumented in-person account opening, missing backup documentation, urgency, post-opening calls asking about the wire's arrival, intent to move funds out quickly, a multipart transfer to China, and personal remarks (payday, unreachability, office closure).
- Brough testifies a JPMorgan contact he names as "Koipal" told him JPMorgan's investigation "was not leading to good places" — treated as an additional red flag, not as the basis for a recall request.
- Brough's phrasing — that he held these facts in mind "at the time that JPMorgan recalled the wire" — frames the recall as JPMorgan's own action, consistent with his contemporaneous internal email at 150.21 ("a recall notice from JPMorgan") and in tension with Korpal's deposition testimony (132.44) that Chain Bridge requested the recall.
- Brough testifies it "was a surprise" to learn Blue Flame had been formed only three days before the wire, and that Evinger and Gonzales (California) each seemed surprised the other side did not know this.
Source Caveats
- The examining attorney's questions are frequently leading ("Was that a red flag to you?"); Brough's affirmative answers are reproduced as his testimony, not independently verified against contemporaneous documents beyond what is cross-referenced above.
- Date
- 2021-05-27
Cite this document
“Deposition of John Brough — Blue Flame Medical LLC v. Chain Bridge Bank, N.A. (E.D. Va.).”
Original at ecf.vaed.uscourts.gov, dated 2021-05-27. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2021-05-27-third-party-plaintiffs-v-jpmorgan-chase-bank-n-a/
, SHA-256 eb072bcfb7d6440b6d9ee2f4262b80d70fdfb88cfa96a6c1ec1f84d64f136f8e.Full text
Case 1:20-cv-00658-LMB-IDD Document 157-5 Filed 05/27/21 Page 1 of 6 PageID#
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EXHIBIT 117
Case 1:20-cv-00658-LMB-IDD Document 157-5 Filed 05/27/21 Page 2 of 6 PageID#
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1 UNITED STATES DISTRICT COURT
2 FOR THE EASTERN DISTRICT OF VIRGINIA
3 (ALEXANDRIA DIVISION)
4
5 BLUE FLAME MEDICAL LLC )Civil Action No.
Plaintiff )1:20-cv-00658(LMB/IDD)
6 )
vs. )
7 )
CHAIN BRIDGE BANK, N.A., )
8 JOHN J. BROUGH and )
DAVID M. EVINGER )
9 Defendants )
10
CHAIN BRIDGE BANK, N.A. )
11 Third-Party Plaintiffs )
)
12 vs. )
)
13 JPMORGAN CHASE BANK, N.A. )
Third-Party Defendant )
14
15
16 - CONFIDENTIAL PURSUANT TO PROTECTIVE ORDER -
17 Remote Videotaped Deposition of John Brough
18 February 2, 2021
19 9:35 a.m.
20
21 Reported by: Bonnie L. Russo
22 Job No. 4398587
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1 Remote Videotaped Deposition of John Brough 12 APPEARANCES (CONTINUED):
2 held through: On behalf of Third-Party Defendant:
3 ALAN SCHOENFELD, ESQ.
3 WILMERHALE, LLP
4 4 7 World Trade Center
250 Greenwich Street
5 5 New York, New York 10007
alan.schoenfeld@wilmerhale.com
6 Veritext Legal Solutions 6 -and-
7 1250 I Street, N.W. ALBINAS PRIZGINTAS, ESQ.
7 WILMERHALE, LLP
8 Washington, D.C. 1875 Pennsylvania Avenue, N.W.
9 8 Washington, D.C. 20006
albinas. prizgintas@wilmerhale.com
10 9 -and-
MARGARITA BOTERO, ESQ.
11 10 WILMERHALE, LLP
12 1225 17th Street, Suite 1660
11 Denver, Colorado 80202
13 margarita.botero@wilmerhale.com
14 12
13
15 Also Present:
16 14 Beth Sharon, Chain Bridge Bank
David Evinger
17 15 Ethan Bearman, Blue Flame Medical, LLC
Bill Gussman
18 Pursuant to Notice, when were present on behalf 16 Geoff Bassett, Videographer
19 of the respective parties: 17
18
20 19
21 20
21
22 22
Page 3 Page 5
1 APPEARANCES: 1 C O NT ENT S
2 2 EXAMINATIONO F JOHNBROUGH PAGE
3 On behalf of the Plaintiff: 3 BY MR. WHITE 9
4 PETER WHITE, ESQ.
4 BY MR. O RSECK 343
JASON T. MITCHELL, ESQ.
5 EKENEDILICHUKWU E. UKABIALA, ESQ. 5
GREGORY KETCHAM-COLWILL, ESQ. 6
6 SCHULTE ROTH & ZABEL, LLP 7
901 Fifteenth Street, N.W. 8
7 Washington, D.C. 20005 9
pete.white@srz.com 10 EXHIBITS
8 jason.mitchell@srz.com
11 Exhibit 73 HandwrittenNotes 135
ekenedilichukwu.ukabiala@srz.com
9 gregory.ketchum-colwill@srz.com CBB00004445
10 12
11 On behalf of the Defendants/1bird-Party Exhibit 74 E-Mail Chain dated 3-25-20 151
Plaintiffs: 13 BFM000013445-448
12 14 Exhibit 75 Incoming Wire Confirmation 181
GARY ORSECK, ESQ. CBB000019939
13 LESLIE ESBROOK, ESQ.
15
CAROLYN FORSTEIN, ESQ.
14 ROBBINS RUSSELL ENGLERT ORSECK & UNTEREINER
Exhibit 76 E-Mail Chain dated 3-26-20 190
2000 K Street, N.W., Fourth Floor 16 CBB00002725729
15 Washington, D.C. 20006 17 Exhibit 77 E-Mail Chain dated 3-26-20 192
gorseck@robbinsrussell.com CBB000000807
16 lesbrook@robbinsrussell.com 18
cforstein@robbinsrussell.com Exhibit 78 Audio Recording 262
17
19 CBB0000254 l
18
19
20 Exhibit 79 Audio Recording 288
20 CBB00002544
21 21
22 22
2 (Pages 2 - 5)
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1 time of the account opening? 1 bank is referenced as an indicator of
2 A. We -- we knew that Heather didn't 2 potentially suspicious activity in the Bank
3 find out about the dollar amount of the 3 Secrecy Act?
4 transaction until after the account was open. 4 A. I do not know if that is
5 Q. Why is that a red flag? 5 specifically in the Bank Secrecy Act. I do not
6 A. Because it's inconsistent with the 6 know the answer to that. I do know that it
7 activity that's -- that's -- that's being -- 7 would qualify as a red flag.
8 being expected by the client. 8 Q. You also testified to your
9 We always ask that question when we 9 impression, during your conversation with
10 open an account. We put it into our platform. 10 Natalie Gonzales and Mark Hariri on the 26th,
11 And if the volumes are greater than that, then 11 that they seemed surprised to learn that
12 that's always a red flag. 12 Mr. Thomas and Mr. Gula had just open the
13 Q. Let me ask a more direct question. 13 account or just opened the business and did not
14 If you are aware that a new customer 14 have prior experience in this field.
15 is not forthcoming with what you consider to be 15 Am I -- am I correctly
16 important information that the bank is 16 characterizing your testimony?
17 requesting, does that, all else equal, give you 17 A. Yes. They were surprised. They
18 cause to question the customer's integrity? 18 were very surprised.
19 MR. WHITE: Object to leading. 19 Q. Did you didn't infer one way or the
20 THE WITNESS: I would -- I would 20 other from their surprise whether anyone at
21 agree with that, yes. It has to go with 21 Blue Flame had advised California officials of
22 whether or not we can -- we can rely on what 22 those facts?
Page 355 Page 357
1 they tell us in the future. 1 A. I assumed that, if the people who
2 BY MR. ORSECK: 2 were responsible for sending the wire didn't
3 Q. You testified earlier today -- and I 3 know about the -- the recipient of the wire,
4 think we 've seen documents -- that you and 4 then yes, that's a red flag.
5 Mr. Evinger asked Mr. Gula for certain document 5 MR. WHITE: Objection to the
6 -- documents to back up the transaction when 6 assumption.
7 you spoke to him on the afternoon of the 25th, 7 BY MR. ORSECK:
8 correct? 8 Q. Why -- why would it be a red flag
9 A. That is correct. 9 that they didn't know those facts?
10 Q. And Mr. Evinger sent him a follow-up 10 A. I think, with the transaction of
11 e-mail making that request? 11 $456 million, everybody who's involved in that
12 A. Yes. We asked in the telephone 12 transaction is going to know the legitimacy of
13 call. And then David sent a follow-up e-mail. 13 the transaction.
14 Q. Did Mr. Gula provide the requested 14 Q. What do you mean by that?
15 information? 15 A. I mean they're going to know whether
16 A. Mr. Gula never supplied the 16 or not the -- the purchaser -- I'm sorry -- the
17 requested information. 17 seller of the product is legitimate, they've
18 Q. Was that, to you, a red flag? 18 been vetted and -- and been approved and gone
19 A. Yes. That certainly was a red flag. 19 through that due diligence process.
20 Absolutely. 20 And -- yeah. It was a surprise to
21 Q. Is the -- do you know whether the 21 hear that they didn't know that the company had
22 failure to provide requested information to a 22 been formed three -- three days ago.
90 (Pages 354 - 357)
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1 Q. You testified or repeated a few 1 A. Yes. Yes.
2 minutes ago that Mr. Koipal from JPMorgan told 2 Q. And did you -- what did you
3 you that JPMorgan's investigation was not 3 understand?
4 leading to good places or words to that effect; 4 A. Well, I mean the next day he was
5 is that right? 5 calling about, you know, whether or not the
6 A. That's correct. 6 wire had come in. He never called David or me
7 Q. That's what he told you on the 7 to tell us about the wire.
8 phone? 8 There were some e-mail conversations
9 A. That is what he told us on the 9 with Maria Cole where he kept on asking if a
10 phone, yes. 10 wire had come in. And this was on the 25th.
11 Q. Was that information a red flag to 11 And -- and Maria said, "No. But how much are
12 you? 12 you expecting?"
13 A. Yes. Certainly the information that 13 So he really never volunteered the
14 JPMorgan supplied to us was a surprise -- well, 14 amount until asked.
15 was a -- was a red flag to us. Was a red flag 15 Q. Was the fact of his calling on the
16 to us. 16 25th to inquire about whether the wire had
17 Q. Did employees -- one or more 17 arrived, was that a red flag to you?
18 employees of yours report to you on March 25th 18 A. Yes. That was a red flag.
19 that they'd had phone interactions with 19 Q. You've testified that you were told
20 Mr. Gula? 20 that the money was going -- that -- that- -
21 A. Yes. 21 that Blue Flame wanted the money, once it came
22 Q. Did any of them describe to you 22 in, to go back out quickly; is that right?
Page 359 Page 361
1 their perceptions of his demeanor or tone on 1 A. That is correct.
2 those calls? 2 Q. Was that a red flag to you?
3 A. Yes. Specifically Heather said that 3 A. Yes. Whenever a client has money
4 Mike Gula came into the bank to open the 4 wired in and then immediately wired out, it's
5 account, which was unusual. He usually -- it 5 always a -- that's always a red flag. It's
6 was I think the only time he came to the bank. 6 something that our -- that we always watch out
7 It might have been the second time. Maybe he 7 for. It can be a -- a number of -- of
8 came to the bank to sign loan documents five, 8 different type of -- of issues can come up with
9 six, seven years ago. I don't know. 9 that.
10 But he never came to the bank to 10 Q. You testified earlier to your
11 open accounts. He did that through our 11 understanding that Blue Flame intended, via a
12 commercial banking division. So just for him 12 multipart transfer, the outgoing money would
13 to come to open the account was unusual. 13 end up in China; is that accurate?
14 The fact that he seemed very anxious 14 A. Yes. That is accurate.
15 to get the account opened immediately is also a 15 Q. Was that a red flag to you?
16 red flag. I mean any time a -- a -- a client 16 A. Yes. Large international wire
17 has a sense of extreme urgency to do something 17 transfers are always red flags, yes.
18 and appears kind of agitated, that's a red 18 Q. We looked at some of your notes from
19 flag. 19 your conversation with Mr. Gula on the 25th.
20 Q. Did you receive any reports about 20 Were his remarks that this was his
21 calls that Mr. Gula placed to the bank after 21 payday and that he would be unreachable and
22 the account was opened? 22 that he was shutting down his D.C. office, was
91 (Pages 358 - 361)
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1 any of that a red flag to you? 1 CERTIFICATE OF OTARY PUBLIC
2 A. Yes. Those were all red flags yes. 2 I Bonnie L. Russo, the officer before
3 Q. Did you have these facts in your 3 whom the foregoing deposition was taken do
4 mind at the time that JPMorgan recalled the 4 hereby ce1tify that the witness whose testimony
5 appears in the foregoing deposition was duly
5 wire?
6 sworn by me· that the testimony of said witness
6 A. Yes. We had those -- those facts in 7 was taken by me in sho1thand and thereafter
7 our mind. And those questions -- and many 8 reduced to computerized transcription under my
8 other questions in our mind, yes. 9 directioll' that said deposition is a tme
9 MR. ORSECK: Thank you. That's all 10 record of the testimony given by said witness·
10 I have. 11 that I am neither counsel for related to nor
11 Pete? 12 employed by any of the parties to the action in
12 MR. WlilTE: Nothing fmther from me. 13 which this deposition was taken; and further
13 MR. ORSECK: All right. Thank you, 14 that I am not a relative or employee of any
14 John. You're done. 15 attorney or counsel employed by the parties
15 THE WITNESS: We're done? All 16 hereto nor fmancially or otherwise interested
16 right. Thank you. 17 in the outcome of the action.
18
17 THE VIDEOGRAPHER: Please stand by
19
18 We're going off the record at 6:24 20
19 p.m.
20 And This concludes today's testimony 21 ota1y Public in and for
21 given by Mr. John Brough. the District of Columbia
22 (Whereupon, the proceeding was _j My Commission expires: August 14, 2025
Page ™j Page365
1 concluded at 6:25 p.m.) 1 ACKNOWLEDGMENT OF DEPONENT
2 2 I JOHN BROUGH do hereby ce1tify that I
3 3 have read the foregoing transcript of my
4 testimony taken on 2/ 21 and fi.uther certify
4
5 that it is a true and acctll'ate record of my
5 6 testimony (with the exception of the
6 7 corrections listed below):
7 8 Page Line Correction
8 9
9 10
10 11
12
11
13
12 14
13 15
14 16
15 17
16 18
17 JOHN BROUGH
19
18
SUBSCRIBED AND SWORN TO BEFORE ME
19 20 TIITS DAY OF _______, 2021.
20 21
21
22 22 (NOTARY PUBLIC) MY COMMISSION EXPIRES:
92 (Pages 362 - 365)
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