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United States v. Groves

United States District Court, E.D. North Carolina, Western Division

November 15, 2017

UNITED STATES OF AMERICA
v.
FONTELLE RICARDO GROVES

          ORDER OF FORFEITURE OF SUBSTITUTE ASSETS

          MALCOLM J. HOWARD SENIOR UNITED STATES DISTRICT JUDGE.

         THIS MATTER comes before the Court on the United States' now Unopposed Second Amended Motion for Forfeiture of Substitute Assets, pursuant to Rule 32.2(e) of the Federal Rules of Criminal Procedure and 21 U.S.C. 853(p). In consideration of the motion and the Declaration of Senior Inspector Julia M. Younts, the defendant's response, as well the entire record in this matter, the Court finds as follows:

         Findings

         On July 21, 2005, the defendant, Fontelle Ricardo Groves, was charged in a Criminal Indictment with, among other offenses, knowingly and intentionally conspiring to distribute and possess with the intent to distribute more than fifty (50) grams of cocaine base (crack), a Schedule II controlled substance, in violation of Title 21, United States Code, Section 846. The Indictment contained a forfeiture allegation notifying the defendant that, pursuant to Title 21 U.S.C. § 853, the United States would seek forfeiture of any and all property constituting, or derived from, any proceeds the defendant obtained directly or indirectly as a result of the offenses and any and all property used or intended to be used in any manner or part to commit and to facilitate the commission of the offenses. The forfeitable property named included the gross proceeds of the defendant's illegal acts, in the amount of $50, 000.00 U.S. Currency. The Indictment also notified the defendant that the United States would seek assets in substitution for any directly forfeitable but unavailable assets, in accordance with 21 U.S.C. § 853(p).

         On October 3, 2005, the defendant entered into a Plea Agreement as to Count One of the Criminal Indictment and agreed to the forfeiture of $50, 000.00 U.S. Currency, a sum equating to the gross proceeds of the defendant's illegal acts. On October 4, 2005, United States Magistrate Judge David W. Daniel entered an Order of Forfeiture, ordering the defendant to forfeit $50, 000.00 U.S. Currency to the United States in the form of a money judgment, based upon the defendant's Plea Agreement. On October 11, 2005, a Judgment in the amount of $50, 000.00 was entered against the defendant. On March 7, 2006, the Court sentenced the defendant to 262 months' imprisonment in the custody of the United States Bureau of Prisons. Though the defendant appealed his criminal conviction, it was affirmed.

         According to Senior Inspector Julia M. Younts, at the time that the Court entered the Order of Forfeiture, the $50, 000.00 U.S. Currency forfeited by the defendant was not in the possession of or its whereabouts known to the Government. According to Inspector Younts, after her review of the presentence report and public databases, she concluded that the $50, 000 in proceeds from criminal activity could not be located. Thus, the proceeds which the defendant agreed to forfeit are unavailable for forfeiture, the only logical implication being that Groves spent or otherwise dissipated the money earned from his illegal activity before it could be located.

         Although Inspector Younts was unable to locate the proceeds earned by the defendant from selling illegal drugs, she did identify the subject inmate trust account held by Groves which contained $2, 110.00[1]. Under Bureau of Prisons regulations, inmates like the defendant have the privilege of maintaining an individual trust account, which may hold money earned from prison employment or deposited from outside sources. Inmates may use the funds for very limited purposes and may withdraw no more than $360 per month from the account, although the Warden may further restrict the account.

         Based on this information, the United States filed a motion for forfeiture of substitute assets on April 8, 2015, serving the motion on the defendant at the institution at which he was then housed. Seven days later, the Court granted the motion. Appeal followed.

         On appeal, the United States sought remand of the case when it became apparent that the defendant had received neither adequate notice nor opportunity to respond, in accordance with Local Rule 47.1(c), which allows a defendant 14 days to respond to a motion. On May 17, 2016, the Fourth Circuit entered an order remanding the case, with directions that the Order appealed from be vacated and the defendant be allowed adequate time to respond to the United States' motion. Mandate issued on June 8, 2016. Notice having been given and response made, the matter is ripe for disposition. The defendant does not oppose the motion.

         Discussion

         Under Rule 32.2(e), "the court may at any time enter an order of forfeiture or amend an existing order of forfeiture to include property that . . . "is substitute property that qualifies for forfeiture under an applicable statute." Fed. R. Crim. P. 32.2(e)(1)(B). Under 21 U.S.C. § 853(p), the forfeiture of substitute property is mandatory if, as a result of any act or omission of the defendant, directly forfeitable property-

(A) cannot be located upon the exercise of due diligence;
(B) has been transferred or sold to, or deposited with, a ...

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