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United States v. Whitlock

United States District Court, W.D. North Carolina, Charlotte Division

May 16, 2018



          Robert J. Conrad, Jr. United States District Judge

         THIS MATTER is before the Court on the United States of America's Motion for Money Judgment and Preliminary Order of Forfeiture, (Doc. No. 39), to which the defendant has not objected. The United States files its Motion pursuant to Fed. R. Crim. P. 32.2(b), 18 U.S.C. § 982(a)(2)(A), and 21 U.S.C. § 853(p). The United States requests that the Court enter:

• A $229, 783.18 forfeiture Money Judgment against Defendant; and
• A Preliminary Order of Forfeiture for approximately $9, 750.50 in United States Currency seized during the course of the investigation of this matter.

         For the reasons set forth below, this Court hereby finds that the United States has stated cause, by a preponderance of the evidence, for the Motion. Therefore, this Court will grant the Motion. The Court finds and concludes as follows:

         I. BACKGROUND

         In April 2017, a Grand Jury returned a Bill of Indictment, (Doc. No. 3), against Defendant, charging him with mail, wire, and bank fraud, all such charges based on his use of so-called “synthetic identities” to obtain credit cards. Defendant ultimately pled guilty to bank fraud, (Doc. No. 27), pursuant to a Plea Agreement, (Doc. No. 25). The Plea Agreement contained a provision for consent to forfeiture of seized items. (Doc. No. 25 at ¶ 10).

         As set forth more fully in the Factual Basis, (Doc. No. 26), and the sentencing record, Defendant agreed that he used the illegally obtained credit cards to (1) obtain money, goods, and services through electronic payments at point-of-sale terminals; (2) obtain money from automated teller machines; and (3) obtain money through merchant accounts accessible to Defendant. At sentencing, this Court ordered Defendant to pay $310, 268.51 in restitution to a victim financial institution, such figure calculated based on the value of money and property that the financial institution paid out as a result of the scheme, less credit for $9, 181.82 that the defense argued that Defendant repaid. The Court indicated that it would leave the issue of forfeiture open pending the instant submission by the Government and Defendant's opportunity to respond.


         A. Overview of Law Authorizing Forfeiture

         Title 18 U.S.C. § 982(a)(2)(A) authorizes forfeiture of property that a defendant obtains, directly or indirectly, that constitutes or derives from proceeds of bank fraud. Further, 28 U.S.C. § 2461(c) renders the substitute property provisions of 21 U.S.C. § 853(p) applicable in a bank fraud case. “Substitute property” of a defendant is subject to forfeiture under 21 U.S.C. § 853(p)(2) when, inter alia, proceeds cannot be located or one of the other criteria in Section 853(p)(1) is met. Finally, Fed. R. Crim. P. 32.2(b)(1)(A) and (B) authorizes a court to review evidence and information on the record and enter a money judgment for the proceeds of the crime, as well as a preliminary order of forfeiture for properties where there is a nexus between the properties and the crime.

         The Government's burden of proof on forfeiture is preponderance of the evidence. United States v. Cherry, 330 F.3d 658, 669 (4th Cir. 2003); United States v. Tanner, 61 F.3d 231, 233 (4th Cir. 1995). The Court's “determination may be based on evidence already in the record, including [ . . . ] any additional evidence or information submitted by the parties and accepted by the court as relevant and reliable.” Fed. R. Crim. P. 32.2(b)(1)(B); see also United States v. Farkas, 474 Fed.Appx. 349, 360 (4th Cir. 2013) (court may rely on trial record to determine forfeiture). The Government may satisfy the preponderance burden by both direct and circumstantial evidence. United States v. St. Pierre, 484 F.3d 75, 86 (1st Cir. 2007).

         B. The Record and Law Support the $229, 783.99 Money Judgment

         “If the government seeks a personal money judgment, the court must determine the amount of money that the defendant will be ordered to pay.” Fed. R. Crim. P. 32.2(b)(1)(A); see also United States v. Butler, 578 Fed.Appx. 178, 182 (4th Cir. 2014) (district court must find nexus between forfeiture calculation and crime). In this case, the Government has limited its request to a conservative calculation of a Money Judgment equivalent to only the amount of net ...

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