286 F.3d 641 (3rd Cir. 2002), 00-2500, U.S. v. $734,578.82 in U.S. Currency
|Citation:||286 F.3d 641|
|Party Name:||U.S. v. $734,578.82 in U.S. Currency|
|Case Date:||April 15, 2002|
|Court:||United States Courts of Appeals, Court of Appeals for the Third Circuit|
Argued July 30, 2001.
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Clark E. Alpert (Argued), David N. Butler, Andrew M. Moskowitz, Alpert Butler Sanders & Norton, P.C., West Orange, NJ, for Appellants.
Robert J. Cleary, United States Attorney, Michael A. Hammer (Argued), Assistant United States Attorney, Newark, NJ, for Appellee.
Before: BECKER, Chief Judge, McKEE, Circuit Judge, and WEIS, Senior Circuit Judge.
McKEE, Circuit Judge.
American Sports Ltd. and Intercash Ltd. I.O.M appeal the district court's grant of summary judgment in favor of the government and the resulting final order of civil forfeiture of United States currency seized from bank accounts established in relation to an illegal gambling business. See 18 U.S.C. § 1955. For the reasons that follow, we will affirm.
I. FACTUAL BACKGROUND 1
Intercash Ltd. I.O.M. ("IOM") is a corporation operating in, and organized under the laws of, the Isle of Man. American Sports Limited ("ASL") and related companies are owned and operated by Gary Bowman. 2 ASL and its related companies operate in the United Kingdom under valid licenses issued by that government. Intercash Financial Services, Ltd. ("IFS Canada"), is a Canadian corporation located in Toronto, Canada. Ivan and Juliana Olenych are members of the Board of Directors of IFS Canada. Although it is not readily apparent from the government's brief, when the government refers to "IFS" it means both IOM and IFS Canada. See Government's Br. at 2. In the government's view, IOM and IFS Canada are the same entity. IFS (i.e., IOM and IFS Canada) was established with funds provided by Bowman and one of his companies, American Sports Betting Service. American Sports Betting Service is located in England.
Intercash Financial Services is a New Jersey corporation ("IFS-NJ") operating in South Bound Brook, New Jersey. It was incorporated in New Jersey in 1995 and its corporate records list Michael Sydor, Dennis Pokoyoway and Yar Jacobs as its district managers. IFS-NJ had three telephone numbers, but it was not listed in the New Jersey telephone books or Yellow Pages. Moreover, there are no hours of operation posted for IFS NJ anywhere in the building where the office is located. Entry to IFS-NJ's office is controlled by an electronic buzzer inside the office. Telephone calls to the office are not answered in a manner that informs the caller that he/she has reached the offices of IFS-NJ. Rather, the phone is merely answered with a "hello."
Bowman promoted his companies on the Internet in advertisements claiming that the companies provided recreational betting services and accepted wagers on sporting events throughout the world. These advertisements detailed the wagering services that Bowman and his companies provided and explained that ASL provided a betting service and accepted
wagers on most sporting events throughout the world. Most of Bowman's business was derived from North American sports such as professional and college football and basketball games. 3
Bowman's advertisements also explained how to remit money, set up an account and place bets. Funds were to be remitted via Western Union wire transfer for deposit in Fleet Bank, N.A., account number 2753-10-3191 to establish accounts and to place bets. ASL is the holder and beneficiary of that Fleet Bank account. Once a bettor established an account, he/she could then call Bowman's company in England via international toll-free telephone numbers to confirm the deposits and to immediately begin gambling on various sporting events around the world.
Dennis Pokoyoway was IFS-NJ's district manager, ran its daily operations, and deposited funds received from bettors into Fleet Bank accounts 2753-10-4767 and 2753-10-3191. IFS-NJ received wire transfers of funds, ranging from $20 to at least $2,000, from bettors throughout the United States. The wire transfers were typically completed through Western Union where IFS Canada/IOM maintained account number APH081580. IFS-NJ received and processed the wire transfers.
After IFS-NJ received a wire transfer, it deposited those funds into accounts maintained for the benefit of IFS Canada/IOM and ASL, including Fleet Bank account number 27523-10-4767, maintained in the name of and/or for the benefit of IFS Canada; and Fleet Bank account number 2753-10-3191, maintained in the name of and/or for the benefit of ASL. 4
Large sums of money were regularly transferred from Fleet Bank account number 2753-10-4767 to 2753-10-3191. For example, in October of 1996, approximately $1.2 million was transferred, and another $550,000 was transferred in November of 1996. Funds in account number 2753-10-3191 were paid out to bettors all over the United States.
IFS-NJ also tallied the funds received on an hourly basis and sent the hourly tallies to Bowman in England. Bettors were therefore able to call ASL and other Bowman betting companies using the aforementioned international telephone numbers to confirm their deposits. This allowed them to place bets soon after wiring money to IFS-NJ.
Two examples cited by the government illustrate IFS-NJ's role in Bowman's gambling operations. The first is the case of Wisconsin bettor, Brian Taff, who sent $32,000 to IFS-NJ via Western Union. Taff's telephone records revealed calls to Bowman in Manchester, England, and investigators subsequently discovered documents related to sports-betting in his garbage. 5 The government argues that it is
reasonable to conclude that Taff wired the $32,000 to IFS-NJ so that he could place bets with Bowman. These funds were included in an accounting that IFS-NJ subsequently sent to Bowman. According to the government, Taff's funds were eventually deposited into one of the accounts at Fleet Bank maintained by either ASL or IFS NJ.
The government's second example is a confidential source that wired Western Union transfers to IFS-NJ to place sports bets of more than $25,000 during 1995. Although the confidential source was aware that the bets were forwarded to a gambling house in England, the source knew that his/her funds went through accounts handled by IFS-NJ.
On December 3, 1998, Pokoyoway (IFS-NJ's district manager), pled guilty in state court in New Jersey to charges of promoting gambling in the third degree, and conspiracy to promote gambling in the third degree. In doing so, he admitted that from August 1995 to approximately December 15, 1996, he deposited funds from Western Union wire transfers into Fleet Bank accounts owned by IFS and ASL. Pokoyoway told law enforcement agents that his duties for IFS-NJ included compiling the aforementioned hourly totals of all checks received by IFS NJ and then informing IFS and Bowman (in England) of the amount of the deposits. According to Pokoyoway, IFS-NJ received well over $1,000 a day between August 1995 and December 15, 1996. He estimated that IFS-NJ averaged twenty to thirty Western Union wire transfers per day, for a daily total of $4,000 to $5,000. He also acknowledged that he knew that the incoming funds were derived from sports gambling.
II. DISTRICT COURT PROCEEDINGS
This litigation began when FBI agents executed a warrant authorizing the search of IFS-NJ's office, and seizure of the contents of Fleet Bank Account number 2753-10-4647, in the name of and/or for the benefit of, IOM and ASL. The warrant also authorized the seizure of all funds received by Fleet Bank for three days after service of the warrant. Thereafter, agents executed a warrant authorizing seizure of the contents of Fleet Bank account number 2753-10-3191, maintained in the name of, and/or for the benefit of, ASL. This warrant also authorized seizure of funds deposited into the account for the three days following execution of the warrant.
Pursuant to these warrants, agents seized $77,660.62 from account number 2753-10-4767 and $268,426.59 from account number 2753-10-3191. The next day, agents obtained a warrant to seize Western Union account number APH081580 in the name of, and/or for the benefit of, IOM. Agents seized an additional $243,491.61 from that account.
Approximately three years later, the government filed the instant civil in rem forfeiture action against those funds. Count I of the complaint alleged criminal violations of 18 U.S.C. § 1955, and sought civil forfeiture pursuant to 18 U.S.C. § 1955(d). Count II alleged violations of 18 U.S.C. § 1956, and sought forfeiture pursuant to 18 U.S.C. § 981. Count III alleged violations of 18 U.S.C. § 1957, and sought forfeiture pursuant to 18 U.S.C. § 981. 6
Following receipt of notice of the forfeiture action, IOM filed a verified claim to the property seized from Fleet Bank account number 2753-10-4647 and Western Union account number APH081580. ASL filed a verified claim for the property seized from Fleet account number 2753-10-3191. The parties eventually stipulated to the facts as pleaded in the government's first amended complaint. Thereafter, both sides moved for summary judgment. The district court granted the government's motion for summary judgment on Count I (seeking forfeiture under § 1955(d) for violations of § 1955), but declined to enter judgment on Counts II and III because all of the currency was forfeited under Count I, and the remaining Counts were therefore moot. The court filed a Final Order of Forfeiture on July 24, 2000, and this appeal by IOM...
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