2002 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

4-15-2002

USA v. $734,578.82

Precedential or Non-Precedential:

Docket No. 00-2500

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PRECEDENTIAL 

 Filed April 15, 2002 

UNITED STATES COURT OF APPEALS 

FOR THE THIRD CIRCUIT 

No. 00-2500 

UNITED STATES OF AMERICA 

v. 

$734,578.82 IN UNITED STATES CURRENCY; 

$589,578.82 IN UNITED STATES CURRENCY 

AMERICAN SPORTS, LTD.; INTERCASH LTD. IOM, 

 Appellants 

On Appeal for the United States District Court 

for the District of New Jersey 

(Dist. Ct. No. 99-cv-00013) 

District Judge: Hon. Katharine S. Hayden 

Argued: July 30, 2001 

Before: BECKER, Chief Judge, McKEE, Circuit Judge, and 

WEIS, Senior Circuit Judge 

(Opinion Filed: April 15, 2002) 

 CLARK E. ALPERT, ESQ. (Argued) 

 DAVID N. BUTLER, ESQ. 

 ANDREW M. MOSKOWITZ, ESQ. 

 Alpert Butler Sanders & 

 Norton, P. C. 

 The Alpert Professional Building 

 449 Mt. Pleasant Avenue 

 West Orange, NJ 07052 

 Attorneys for Appellants 

 

 ROBERT J. CLEARY, ESQ. 

 United States Attorney 

 MICHAEL A. HAMMER, ESQ. 

 (Argued) 

 Assistant United States Attorney 

 970 Broad Street, Suite 700 

 Newark, NJ 07102 

 Attorneys for Appellee 

OPINION OF THE COURT 

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. S 1955. For the reasons that follow, we will 

affirm. 

I. FACTUAL BACKGROUND1 

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- 

_________________________________________________________________ 

1. The facts are not in dispute. By a Stipulation, dated December 3, 

1999, the parties agreed that the facts are as pleaded in the 

Government’s First Amended Verified Complaint of Forfeiture in Rem. 

2. The related Bowman-owned sports betting companies are American 

Sports Betting Service, Sports Action International and International 

Sports Betting Corp. 

 2 

 

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 

_________________________________________________________________ 

3. Bowman claims that most of his customers are from the United States 

and Canada. 

 3 

 

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 IFSCanada/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 

_________________________________________________________________ 

4. IFS-NJ deposited thousands of dollars each day into those accounts. 

These deposits represented wagers from numerous bettors across the 
United States. For example, on December 9, 1996, Pokoyoway made 

deposits ranging from $2,000 to $15,000 for IFS-Canada. In addition, 

Western Union corporate security officers informed Federal Bureau of 

Investigation agents in October of 1996 that IFS-NJ had been sending 

Gary Bowman as much as $90,000 per day. 

 4 

 

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 sportsbetting in his garbage.5 The government argues that it is 

reasonable to conclude that Taff wired the $32,000 to IFSNJ 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 IFSNJ 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 

_________________________________________________________________ 

5. Although not relevant to our analysis, it is interesting to note that this 

entire forfeiture proceeding began fortuitously when agents of the 

Wisconsin Attorney General’s Office informed New Jersey authorities that 

they had discovered sports-betting information in Taff ’s garbage. The 

contents of his garbage were of interest to Wisconsin authorities because 

they suspected Taff ’s involvement in narcotics. The documents in Taff ’s 

garbage led to an international investigation into sports-betting that 

eventually involved the FBI, the Royal Canadian Mounted Police, and 

authorities in England and the United States. 

 5 

 

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. S 1955, and sought civil forfeiture pursuant to 18 

U.S.C. S 1955(d). Count II alleged violations of 18 U.S.C. 

S 1956, and sought forfeiture pursuant to 18 U.S.C. S 981. 

Count III alleged violations of 18 U.S.C. S 1957, and sought 

forfeiture pursuant to 18 U.S.C. S 981.6 

_________________________________________________________________ 

6. The government subsequently filed a First Amended Verified 

Complaint in which it clarified that the actual amount of currency was 

$489,578.82. Apparently, $145,000 had been withdrawn from Fleet 

Bank account number 2853-10-4767 after agents served the warrant, 

but before the bank tendered the proceeds to the government. 

 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 S 1955(d) for violations of 

S 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 and ASL (hereinafter collectively referred to 
as "Claimants") followed. 

III. DISCUSSION 

18 U.S.C. S 1955 provides in relevant part: 

 (a) Whoever conducts, finances, manages, supervises, 

 directs, or owns all or part of an illegal gambling 

 business shall be fined under this title or imprisoned 

 not more than five years, or both. 

 (b) As used in this section-- 

 (1) "illegal gambling business" means a gambling 

 business which-- 

 (i) is a violation of the law of a State or political 

 subdivision in which it is conducted; 

 (ii) involves five or more persons who conduct, 

 finance, manage, supervise, direct, or own all or part of 

 such business; and 

 (iii) has been or remains in substantially continuous 

 operation for a period in excess of thirty days or has a 

 gross revenue of $2,000 in any single day. 

18 U.S.C. S 1955(a), (b)(1)(i) - (iii). The term "gambling" 

"includes but is not limited to pool-selling, bookmaking, 

maintaining slot machines, roulette wheels or dice tables, 

and conducting lotteries, policy, bolita or numbers games, 

 7 

 

or selling chances therein." 18 U.S.C. S 1955(2). The statute 

also authorizes civil forfeiture as follows: "[a]ny property, 

including money, used in violation of the provisions of 

[S 1955] may be seized and forfeited to the United States." 

18 U.S.C. S 1955(d). 

A. Burden of Proof in S 1955(d) Civil Forfeiture 

 Proceedings. 

The government bears the initial burden in a forfeiture 

proceeding under S 1955. See United States v. On Leong 

Chinese Merchants Ass’ n Bldg., 918 F.2d 1289 (7th Cir. 

1990). 

 The government’s burden in a [S 1955(d)] civil forfeiture 

 is merely to establish probable cause to believe that the 

 defendant property is subject to forfeiture. Probable 

 cause is defined as reasonable ground for the belief of 

 guilt supported by less than prima facie proof but more 

 than mere suspicion. Of course, probable cause must 

 be demonstrated with respect to every essential 

 element of the alleged violation. Once the government 

 demonstrates probable cause . . . the ultimate burden 

 shifts to the claimant to prove by a preponderance of 

 the evidence that the property is not subject to 
 forfeiture. 

Id. at 1292 (citations and internal quotations omitted). This 

is identical to the burdens imposed for civil in rem 

forfeitures under 21 U.S.C. S 881(a)(6). Thus, in relying 

upon On Leong, we are merely applying our understanding 

of the burden-shifting procedure described in 19 U.S.C. 

S 1615 to this civil forfeiture action brought pursuant to 18 

U.S.C. S 1955(d). See United States v. $10,700.00, 258 F.3d 

215, 222 (3d Cir. 2001). 

If the government satisfies its burden of proof, and the 

party opposing forfeiture fails to establish that the property 

is not subject to forfeiture, forfeiture will be ordered 

regardless of the culpability of the claimant. "[T]he presence 

or involvement of the claimant is simply immaterial" to the 

government’s right to seek forfeiture. Id. at 1293.7 

_________________________________________________________________ 

7. Forfeitures under S 1955 therefore differ from forfeitures under the 

Comprehensive Drug Abuse Prevention and Control Act, 21 U.S.C. S 881 

 8 

 

 The language of [S 1955(d)] does not condition forfeiture 

 on any suggestions that the claimant itself directed or 

 managed the illegal gambling operation. [Rather,] [i]t 

 authorizes the forfeiture of ‘any property . . . used in 

 violation of the provisions of this section.’ Though one 

 of the preceding subsections does make it illegal to 

 ‘conduct, finance, supervise, direct, or own all or part 

 of an illegal gambling business’ . . . the forfeiture 

 subsection is not limited . . . to property owned by 

 those who themselves conduct or oversee illegal 

 gambling businesses. 

Id. at 1293 (citations omitted)(emphasis in original). This 

disjuncture between criminal culpability and exposure to 

forfeiture arises from a legal fiction. " ‘Traditionally, 

forfeiture actions have proceeded upon the fiction that 

inanimate objects themselves can be guilty of wrongdoing.’ " 

Id. (quoting United States v. U. S. Coin and Currency, 401 

U.S. 715, 719 (1971)). Therefore, "the object itself is the 

formal defendant." Id. Thus, "forfeiture can be ordered even 

in the absence of any wrongdoing on the claimant’s part." 

Id; see also United States v. Sandini, 816 F.2d 869, 872 (3d 

Cir. 1987) ("Civil forfeiture is an in rem proceeding. The 

property is the defendant in the case. . . . The innocence of 

the owner is irrelevant -- it is enough that the property was 

involved in a violation to which forfeiture attaches.").8 

B. The Government’s Showing of Probable Cause. 

18 U.S.C. S 1955(b)(1)(i) first looks to relevant state law to 

_________________________________________________________________ 

et seq. (West 1981 & Supp. 1984). "Congress engrafted an ‘innocent 

owner’ defense to forfeiture under SS 881(a)(4), (6) and (7).’ " United States 

v. One 1973 Rolls Royce, 42 F.3d 794, 799 (3d Cir. 1994). 
8. But see Calero-Toledo v. Pearson Yacht Leasing Co., 416 U.S. 663, 689 

(1974), suggesting in "now-famous dicta that Fifth Amendment just 

compensation concerns might preclude a judge from ordering forfeiture 

if the owner proves ‘he was uninvolved and unaware of the wrongful 

activity, but also that he had done all that reasonably could be expected 

to prevent the proscribed use of his property.’ " United States v. On Leong 

Chinese Merchants Ass’n Bldg., 918 F.2d 1289, 1293 n.3. (7th Cir. 

1990). 

 9 

 

determine whether a given activity constitutes gambling. 

Here, the alleged illegal activity occurred in New Jersey. 

Therefore, "[t]he relevant burden of proof requires merely 

that the government establish probable cause to believe 

that [New Jersey] gambling laws were being violated." On 

Leong, 918 F.2d at 1293. 

The relevant New Jersey law here is set forth at N.J.S.A. 

2C:37-2. That statute makes it a crime to engage in 

"promoting gambling," and provides that: 

 [a] A person is guilty of promoting gambling when he 

 knowingly: 

 (1) Accepts or receives money or other property, 

 pursuant to an agreement or understanding with any 

 person whereby he participates or will participate in 

 the proceeds of gambling activity; or 

 (2) Engages in conduct, which materially aids any 

 form of gambling activity. Such conduct includes but is 

 not limited to conduct directed toward the creation or 

 establishment of the particular game, contest, scheme, 

 device or activity involved, toward the acquisition or 

 maintenance of premises, paraphernalia, equipment or 

 apparatus therefor, toward the solicitation or 

 inducement of persons to participate therein, toward 

 the actual conduct of the playing phases thereof, 

 toward the arrangement of any of its financial or 

 recording phases, or toward any other phase of its 

 operation. 

N.J.S.A. 2C:37-2a(1), (2) (emphasis added). Moreover, 

"gambling" is defined to include "staking or risking 

something of value upon the outcome of a contest of chance 

or a future contingent event not under the actor’s control or 

influence, upon an agreement or understanding that he will 

receive something of value in the event of a certain 

outcome." N.J.S.A. 2C:37-1b. 

Given the breadth of this definition, we agree that the 

government clearly established probable cause to believe 

that IFS-NJ was "promoting gambling" in violation of New 

Jersey law by materially aiding Bowman’s gambling 

enterprises.9 IFS-NJ was a integral component of Bowman’s 

gambling enterprise. It received funds from bettors 

_________________________________________________________________ 
9. As noted earlier, see supra n.1, the government and the Claimants 

stipulated that the facts are as stated in the government’s first amended 

complaint. 

 10 

 

throughout the United States and processed those transfers 

so that the bettors could open accounts and place bets with 

ASL and other Bowman companies. It sent Bowman an 

hourly accounting of these funds. This allowed Bowman to 

monitor betting income and it also allowed bettors to call 

ASL and Bowman to confirm their deposits and place bets. 

IFS-NJ was also part of the payout mechanism that 

ensured that winning bettors collected on their wagers. IFSNJ clearly "[e]ngage[d] in conduct, which materially aid[ed] 

. . . gambling activity." Its conduct was "directed . . . toward 

the arrangement of [the gambling activity’s] financial or 

recording phases." N.J.S.A. 2C:37-2a(2). 

Even though the stipulated facts support the legal 

conclusion that IFS-NJ promoted gambling under New 

Jersey law, Claimants nonetheless argue that the 

government failed to establish probable cause. They argue 

instead that the seizure and forfeiture here "represent[ ] a 

prosecutorial excess." Claimants’ Br. at 11. Their argument 

is largely based upon the generally accepted conflict of laws 

principle that a gambling transaction occurs in the country 

where the bet or wager is accepted. Id. at 13-14 (quoting 

Dicey & Morris, The Conflict of Laws 1468 (1993)). They 

insist that the gambling transactions here actually occurred 

in England where the bets were ultimately "accepted." 

Claimants insist that there was no illegal gambling activity 

at all in this case because gambling is legal in England, 

and all of the actors there were legally licensed to conduct 

a gambling business. According to Claimants, IFS-NJ 

merely "performed a facially, neutral, ministerial function in 

the United States." Id. at 10. They attempt to buttress this 

claim by reminding us that IFS-NJ "was not open to the 

public, listed in any telephone directory, or identified in any 

advertising material as a place where bets could be placed." 

They are also quick to point out that the company’s 

"operations did not include fixing odds, declaring winners 

or losers, or accepting or relaying bets or wagers." Id. at 5, 

12. Claimants largely rest this argument on three cases 

which we will discuss in turn.10 

_________________________________________________________________ 

10. Claimants cite a host of cases from various states dealing with 

gambling. However, we do not believe that any of them are helpful for the 

 11 

 

The first is State v. Andreano, 285 A.2d 229 (N. J. App. 

Div. 1971). There, the defendant was charged with 

bookmaking and gambling in violation of New Jersey law. 

His defense at trial was that he was not a bookmaker at all. 

Rather, he argued that he was simply acting as a 
messenger who took others’ bets to a legal, in-state parimutuel race track as a favor. The trial judge instructed the 

jury that under the New Jersey law, "bookmaking" occurs 

whenever an individual accepts a bet from another with the 

intent of subsequently placing the bet at a pari-mutuel race 

track, irrespective of whether that individual acts only as a 

conduit and does not benefit from the transaction. On 

appeal, the Appellate Division reversed the conviction based 

upon that instruction. That court held that "when the bet 

is taken by a disinterested individual for placement at a 

lawful race meeting, such activity is not bookmaking within 

the statutory prohibition." Id. at 231. 

Claimants contend that, under Andreano,"mere[ly] 

handling . . . funds, [which are] destined for a lawful 

location inside or outside the State, does not constitute an 

unlawful gaming activity." Claimants’ Br. at 23. Since IFSNJ only transferred funds to England, where the relevant 

parties were duly licensed and gambling is legal, Claimants 

insist that IFS-NJ could not have engaged in illegal 

gambling activity under New Jersey law. 

However, Claimants’ reading of Andreano is far too 

narrow. Andreano was charged with "bookmaking," and the 

government here is not claiming that IFS-NJ’s operations 

constituted bookmaking under New Jersey law. Moreover, 

the statute under which Andreano was charged has since 

been repealed. That earlier statute did not prohibit 

"promoting gambling" as current law does. The 

government’s forfeiture claim rests upon an assertion that 

IFS-NJ promoted gambling as currently defined in N.J.S.A. 

_________________________________________________________________ 

simple reason that the government’s seizure and forfeiture is predicated 

upon its claim that IFS-NJ violated New Jersey statutory law. Thus, the 

issue is whether the government had probable cause to believe that IFSNJ’s activities promoted gambling as defined in the New Jersey statute, 

not whether the government had probable cause to believe that IFS-NJ’s 

operations would have been illegal under British law. 

 12 

 

2C:37-2, and Andreano does not assist the Claimants in 

that regard.11 

The second case Claimants rely upon is United States v. 

Truesdale, 152 F.3d 443 (5th Cir. 1988). The gambling 

operation in Truesdale was strikingly similar to the 

operation here. There, World Sportsbook ("WSB") operated 

a gambling business in the Dominican Republic, Jamaica, 

and in Dallas, Texas. Its operations were legal in Jamaica 

and the Dominican Republic. Bettors placed bets by calling 

WSB’s Jamaican and Dominican offices, and those offices 

accepted and processed the wagers. Bets could only be 

placed via "offshore" telephone numbers. However, WSB 

opened accounts by sending funds to its Dallas office via 

Western Union wire transfer or overnight delivery. WSB 

employees in the Dallas office received these funds and 

deposited them into various bank accounts in and around 
Dallas for WSB. 

The federal government successfully prosecuted WSB’s 

Dallas employees for illegal gambling in violation of 18 

U.S.C. SS 1955 and 1955(b)(1)(i). The government charged 

that the employees were guilty of "bookmaking," under 

Texas Penal Code S 47.01(2)(A)-(C), and that this 

constituted a violation of S 1955. Section 47.01(2)(A)-(C) of 

the Texas Penal Code made it a crime to receive, record, or 

forward: (1) more than 5 bets or offers to bet in a day; or 

(2) more than $1,000 in a day; or (3) to scheme to receive, 

record, or forward a bet or an offer to bet. However, the 

Court of Appeals for the Fifth Circuit reversed the 

defendants’ convictions. The court held that there was 

_________________________________________________________________ 

11. Claimants argue that Andreano is still significant because even 

though the statue Andreano was charged with violating was repealed, it 

was replaced by the statute at issue here. Claimants maintain that we 

should be guided by the repealed bookmaking statute when interpreting 

N.J.S.A. 2C:37-2. Reply Br. at 9. This argument ignores the fact that the 

relevant statute in Andreano did not prohibit "promoting of gambling," 

and we certainly cannot ignore the difference in the language between 

the old and new statutes. "The starting point for interpreting a statute is 

the language of the statute itself. Absent a clearly expressed legislative 

intention to the contrary, that language must ordinarily be regarded as 

conclusive." Temple Univ. v. United States , 769 F.2d 126, 132 (3d Cir. 

1985). 

 13 

 

insufficient evidence that the defendants engaged in 

bookmaking under Texas law merely by accepting bets in 

Texas. The court’s holding was based upon its conclusion 

that the actual bookmaking (i.e. accepting bets), actually 

occurred in the Dominican Republic and Jamaica where it 

was legal. 

Truesdale does, at first blush, support Claimants’ 

position because here, as in Truesdale, bets were actually 

"placed" outside of the United States in a jurisdiction where 

betting was legal and where the betting business was 

properly licensed. However, the defendants in Truesdale 

were charged with bookmaking, and the government’s 

averments here are not analogous. Rather, the government 

alleges that IFS-NJ was "promoting gambling" under a New 

Jersey statute that prohibits conduct "which materially aids 

any form of gambling activity," N.J.S.A. 2C:37-2a(2). 

Moreover, upon a closer reading, Truesdale actually 

undermines Claimants’ position. In Truesdale, bookmaking 

was only one of five activities defined as "gambling 

promotion" under Texas law. Section 47.03(a)(3) of the 

Texas Penal Code made it a separate offense for an 

individual to "become[ ] a custodian of anything of value bet 

or offered to be bet[ ]" for gain. However, the indictment in 

Truesdale did not allege that conduct as a predicate for the 

federal prosecution under S 1955. It only broadly alleged 

bookmaking. Therefore, "the fact that the [defendants had] 
engaged in financial transactions in the State of Texas that 

may have run afoul of Section 47.03(a)(3) [was] irrelevant." 

152 F.3d at 447. Nevertheless, in Truesdale, the 

government argued that the convictions could be upheld 

because the underlying financial transactions "were an 

essential part of the operation." Id. at 449. The court of 

appeals rejected that argument, saying: 

 The government maintains that these financial 

 transactions were an essential part of the operation. It 

 may be true that these financial transactions were 

 essential to the overall operation, but they do not 

 establish an essential element of the crime of 

 "bookmaking" as it is defined by Texas law. The Texas 

 bookmaking statute prohibits recording, receiving, and 

 forwarding bets; where and how the money is paid out 

 14 

 

 is irrelevant under section 47.03(a)(2). Becoming a 

 custodian of money that is used to place bets offshore 

 would be a violation of section 47.03(a)(3). However, the 

 indictment did not allege that the appellants violated 

 section 47.03(a)(3) and the jury was not instructed on 

 any such violation. Nor was the case tried on that 

 theory. In short, the government’s case and the jury’s 

 verdict were focused exclusively on illegal bookmaking, 

 and we cannot affirm the case on a different theory. 

Id. at 449 (emphasis added). The highlighted portion of this 

statement is dicta, but it illustrates the distinction between 

the circumstances in Truesdale, and the circumstances 

here. 

The third case Claimants rely upon is California v. 

Cabazon Band of Mission Indians, 480 U.S. 202 (1987). 

Claimants argue that Cabazon stands for the proposition 

that one sovereign cannot criminalize gambling activity that 

is legal under the laws of another sovereign. However, 

Cabazon is even less helpful to Claimants than Truesdale. 

Cabazon was concerned with whether Congress intended to 

allow state laws to apply on Indian reservations. The 

precise issue was whether a state could apply its gambling 

laws to bingo games held on Indian reservations. Id. at 207- 

212. In resolving that issue the court merely stated that 

nothing in the Organized Crime Control Act (which includes 

S 1955) permits the states to enforce federal gambling laws 

against Indian tribes. Id. at 213-14. This unique case 

involving tribal sovereignty in no way furthers our inquiry 

into whether IFS-NJ promoted gambling as defined under 

applicable New Jersey law. 

Given the language of the relevant statute here, we 

conclude that the government established probable cause 

that IFS-NJ’s conduct violated New Jersey’s law against 

promoting gambling, and the government therefore satisfied 

its burden of proof with regard to the first element of 

S 1955(b)(1)(i). 
However, the government must establish probable cause 

as to every essential element of S 1955(b)(1), On Leong, 918 

F.2d at 1292, and Claimants allege that the government 

ignored the second and third elements of that statute. The 

 15 

 

government insists that Claimants never raised this 

argument in the district court, and the Claimants do not 

argue to the contrary. Nor do they elaborate on their 

statement that the government ignored the remaining 

elements here. Rather, Claimants merely make the general 

assertion that IFS-NJ was not an illegal gambling business 

and, the defendant funds were therefore not subject to 

seizure and forfeiture. Reply Br. at 16. 

We generally do not address issues that are raised for the 

first time on appeal. Harris v. City of Philadelphia, 35 F.3d 

840, 845 (3d Cir. 1994) ("This Court has consistently held 

that it will not consider issues that are raised for the first 

time on appeal.").12 Here, however, the parties have entered 

into a stipulation which allows us to readily dismiss this 

additional claim. If we assume arguendo that Claimants 

have not waived this argument, it is clear that the 

stipulated facts enable the government to satisfy its burden 

under the second and third elements of SS 1955(b)(1)(ii) and 

(iii). 

The second element of S 1955(b)(1) requires that the 

"illegal gambling business . . . involve[ ] five or more 

persons who conduct, finance, manage, supervise, direct or 

own all or part of such business." 18 U.S.C.S 1955(b)(1)(ii). 

A person " ‘conducts’ an illegal gambling business [under 

the statute] by performing any necessary function in the 

gambling operation, other than that of a mere bettor." 

United States v. Miller, 22 F.3d 1075, 1077 (11th Cir. 

1994)(citation omitted). Here, the parties stipulate that each 

of the following seven people conducted the gambling 

business: Dennis Pokoyoway, Michael Sydor, Yar Jacobs, 

Juliana Olenych, Ivan Olenych, Katharine Sobczak and 

Gary Bowman.13 

_________________________________________________________________ 

12. An exception to this general principle exists"in the horrendous case 

where a gross miscarriage of justice would occur" if we did not consider 

an issue not raised in the district court. Newark Morning Ledger v. 

United States, 539 F.2d 929, 932 (3d Cir. 1967). 

13. Pokoyoway, Sydor and Jacobs were district managers for IFS-NJ. 

Pokoyoway oversaw IFS-NJ’s daily operations and deposited funds 

received from bettors into bank accounts maintained for the benefit of 

IOM and ASL. Sydor signed the Quick Chek Service application to 

 16 

 

The third element requires that the gambling operation 

"has been or remains in substantially continuous operation 

for a period in excess of thirty days or has a gross revenue 
of $2,000 in any single day." 18 U.S.C. S 1955(b)(1)(iii). The 

facts as stipulated to in the first amended complaint 

establish that IFS-NJ was in operation for more than 30 

days, and that IFS-NJ received more than $2,000 in a 

single day. 

Claimants’ argue that the district court erred in 

considering Pokoyoway’s state convictions and admissions 

he made during his guilty plea colloquy when determining 

if the government satisfied its burden. Inasmuch as the 

conviction and colloquy came after the initial seizure of 

currency, Claimants maintain that they can not possibly 

furnish probable cause for a seizure that already occurred. 

Claimants’ Br. at 1. 

The second paragraph of S 1955(d)14 incorporates the 

_________________________________________________________________ 

Western Union and received bills sent to IFS-NJ. Ivan and Juliana 

Olenych were members of the board of IFS-Canada. They set up IFS-NJ 

and recruited and hired Pokoyoway. Sobczak helped Pokoyoway with 

bookkeeping, preparing deposits and faxing information to Bowman in 

England. Finally, Bowman owned, funded, operated and promoted the 

gambling enterprises that IFS-NJ served. Of the seven individuals, only 

two -- Pokoyoway and his girlfriend, Sobczak,-- were actually present 

in New Jersey. Bowman was in England and the other four were in 

Canada. 

Claimants argue that each of the people needed to meet the second 

element under S 1955(1) must be present in the United States. However, 

they cite no authority for that proposition and we have found none. The 

government does not respond to that assertion other than listing these 

seven individuals and stating that this is sufficient to satisfy the second 

element. We agree. 

As we have discussed, the offending conduct occurred in New Jersey, 

and nothing in S 1955 suggests that Congress intended to require all of 

the persons involved in an "illegal gambling business" to be located 

inside of the United States so long as the other conditions of the statute 

are satisfied. Moreover, no such requirement arises under the Commerce 

Clause. See United States v. Boyd, 149 F.3d 1062, 1066 (10th Cir. 

1998). Accordingly, we reject Claimants’ position. 

14. Which provides: "All provisions of law relating to the seizures, 

summary, and judicial forfeiture procedures, and condemnation of 

 17 

 

burden of proof required for customs forfeitures under 19 

U.S.C. S 1615.15 The claimant in a proceeding under S 1615 

bears the ultimate burden, however, "probable cause [must] 

first be shown for the institution of such suit or action." 

There is a circuit split as to whether the government must 

demonstrate that probable cause existed before it initiated 

forfeiture proceedings under S 1615, or whether the 

government can demonstrate probable cause by relying 

upon evidence it was unaware of until after proceedings 

began. Compare United States v. $191,910.00 in U. S. 

Currency, 16 F.3d 1051, 1066 (9th Cir. 1994) (prohibiting 
the use of "after-acquired evidence"); United States v. 

$91,960.00, 897 F.2d 1457, 1462 (8th Cir. 1990) (same), 

with United States v. Premises and Real Property at 4492 S. 

Livonia Road, 889 F.2d 1258, 1268 (2d Cir. 1989)(stating 

that "after-acquired evidence" can support probable cause); 

United States v. $67,220.00 in United States Currency, 957 

F.2d 280, 284 (6th Cir. 1992) (adopting Livonia ). 

Pokoyoway pled guilty to the state gambling charges on 

December 3, 1998. See First Amend. Compl. atP 59. 

However, the government did not file its forfeiture 

_________________________________________________________________ 

vessels, vehicles, merchandise, and baggage for violation of the customs 

laws; the disposition of such vessels, vehicles, merchandise, and baggage 

or the proceeds from such sale; the remission or mitigation of such 

forfeitures; and the compromise of claims and the award of 

compensation to informers in respect of such forfeitures shall apply to 

seizures and forfeitures incurred or alleged to have been incurred under 

the provisions of this section, insofar as applicable and not inconsistent 

with such provisions. Such duties as are imposed upon the collector of 

customs or any other person in respect to the seizure and forfeiture of 

vessels, vehicles, merchandise, and baggage under the customs laws 

shall be performed with respect to seizures and forfeitures of property 

used or intended for use in violation of this section by such officers, 

agents, or other persons as may be designated for that purpose by the 

Attorney General." 18 U.S.C. S 1955(d). 

15. The second sentence of 18 U.S.C. S 1995(d) states: "[a]ll provisions of 

laws relating to the seizures, . . . and judicial forfeiture procedures, . . . 

of vessels, vehicles, merchandise, and baggage for violation of the 

customs laws; . . . shall apply to seizures and forfeitures . . . incurred 

under the provisions of this section, insofar as practicable and not 

inconsistent with such provisions." 

 18 

 

complaint until January 4, 1999. Therefore, if we conclude 

that forfeiture begins with the filing of the forfeiture 

complaint, Pokoyoway’s plea would not be "after-acquired 

evidence," and there is no issue as to whether his 

conviction and admissions he made during his plea 

colloquy can establish the probable cause necessary to 

support the forfeiture. On the other hand, since the Fleet 

Bank accounts were seized in December 1996, Pokoyoway’s 

conviction and plea colloquy statements would be"afteracquired evidence." 

We have not yet addressed this issue directly. However, 

we have addressed the question in the context of a civil 

forfeiture under 21 U.S.C. S 881. In United States v. Ten 

Thousand Seven Hundred Dollars and No Cents 

($10,700.00), 258 F.3d 215 (3d Cir. 2001), we stated: "[T]he 

government bears the burden of establishing . . . probable 

cause to believe that the currency was subject to forfeiture 

at the time that it filed the forfeiture complaints in the 

District Court." Id. at 222 (emphasis added). Our analysis 

was based upon our reading of the respective burdens of 

proof for customs seizures under 19 U.S.C. S 1615. As 
noted above, the same standard applies to forfeitures under 

S 1955 because S 1955(d) incorporates the procedures for 

customs forfeitures into the gambling statute. That controls 

our inquiry here, and we therefore hold that probable cause 

must exist to support the forfeiture when the government 

files the forfeiture complaint.16 

As noted above, Pokoyoway pled guilty on December 3, 

1998, and the government filed its forfeiture complaint 

approximately one month later on January 4, 1999. 17 

Therefore, admissions Pokoyoway made during his change 

_________________________________________________________________ 

16. This view avoids the obvious questions of fundamental fairness that 

would rise from the government attempting to have a court order 

forfeiture without first having an adequate factual basis to support the 

request. 

17. As noted, the government filed a first amended complaint on March 

25, 1999 to correct the amount of the defendant currency and the Fleet 

Bank account numbers. 

 19 

 

of plea colloquy were properly considered in the course of 

the subsequent forfeiture proceedings under S 1955(d).18 

Since the government met its burden of establishing 

probable cause that the currency was subject to forfeiture, 

the burden shifted to Claimants to establish by a 

preponderance of the evidence that the property was not 

subject to forfeiture. On Leong, 918 F.2d at 1292. ("Once 

the government demonstrates probable cause in a forfeiture 

case, the ultimate burden shifts to the claimant to prove by 

a preponderance of the evidence that the property is not 

subject to forfeiture."). 

C. The Claimants’ Burden. 

Although Claimants make several arguments in opposing 

forfeiture, most if not all of those arguments can be 

reduced to a subset of Claimants’ main contention that IFSNJ’s activities in New Jersey cannot be illegal because all of 

the gambling occurred in England, where the relevant 

actors were properly licensed to engage in this activity. 

They maintain that the New Jersey gambling statute does 

not apply in England where the bets were accepted. They 

cite no authority for their basic proposition other than the 

testimony of various experts on the legislative history and 

intent of New Jersey’s gambling statutes. 

Claimants’ experts testified that N.J.S.A. 2C:37-2"was 

always intended to apply . . . to the promotion of‘illegal’ 

gambling only, not gambling under a governmental license." 

_________________________________________________________________ 

18. Claimants cite United States v. One Single Family Residence Located 

at 18755 North Bay Road, Miami, 13 F.3d 1493 (11th Cir. 1994) in 

stating that Pokoyoway’s conviction "has no significance here, where 
there was no testimony." Claimants’ Br. at 1. However, One Family 

Residence turned on the district court’s erroneously concluding that a 

spouse was estopped from challenging a forfeiture petition filed against 

a residence owned by husband and wife as tenants by the entireties. The 

Court of Appeals for the Eleventh Circuit reversed because the wife had 

not been a party to her husband’s criminal trial and therefore was not 

estopped from challenging any of the factual determinations her 

husband’s conviction was based upon. The government’s probable cause 

showing here is based upon Pokoyoway’s own admissions during his 

plea colloquy. Government’s Br. at 26. 

 20 

 

See Appellants’ Br. at 8. Claimants’ experts testified that 

the district court’s interpretation of the statute would 

criminalize such things as legitimate interstate banking and 

advertising relationships. Id. Although Claimants’ argument 

has some appeal, it ignores the text of New Jersey’s statute. 

That statute prohibits "conduct, which materially aids any 

form of gambling activity," and the scope of that language 

is illustrated by the New Jersey Appellate Division’s 

analysis in State v. Fiola, 576 A.2d 338 (N. J. App. Div. 

1990). 

The business in Fiola "involve[d] the solicitation and 

receipt of money in New Jersey for the purchase of lottery 

tickets issued by other states, the transport of money to 

other states to purchase lottery tickets and the return of 

the tickets to New Jersey for delivery to customers." Id. at 

339. The New Jersey Attorney General petitioned to enjoin 

the defendants’ business alleging that it violated the state’s 

constitutional and statutory prohibitions against gambling. 

The trial court refused to grant an injunction, but the 

Appellate Division reversed. That court held that even 

though the defendants’ criminal culpability was not at 

issue, their "transport of gambling requests and money to 

out-of-state gambling sites and the return of lottery tickets 

to New Jersey gamblers ‘materially aids [a] form of gambling 

activity’ within the intent of N.J.S.A. 2C:37-2(a)(2)." Id. at 

340. The Appellate Division held that the defendants’ mere 

"possession of lottery tickets for distribution to their 

customers violates N.J.S.A. 2C:37-2(a)(2)." Id. 

Therefore, even if we accept Claimants’ argument that the 

gambling occurred outside of New Jersey where it is legal, 

their activity inside of New Jersey was nevertheless illegal 

because it promoted a gambling enterprise. Claimants’ 

argument requires that we ignore the wording of the statute 

as well as relevant decisions of New jersey appellate courts 

that have interpreted it. We will do neither. In fact, despite 

Claimant’s insistence that we view IFS-NJ’s conduct 

through the narrowest of lenses, it is clear to us that the 

conduct here exemplifies the breadth of the statute. 

Similarly, we reject Claimants’ assertion that the district 

court applied New Jersey criminal law extraterritorially 

contrary to the limitations to specific provisions of the New 

 21 
 

Jersey Crimes Code. See N.J.S.A. 2C:1-3a(1)-(6). More 

specifically, Claimants argue that under N.J.S.A. 2C:1-3a(4) 

New Jersey’s prohibition against promoting gambling can 

not be applied to IFS-NJ’s conduct inside of New Jersey 

unless that conduct is also illegal in England. See N.J.S.A. 

2C:1-3a(4). 

This argument ignores the critical fact that New Jersey 

has not attempted to prosecute IFS-NJ for violating its 

promoting gambling statute. Rather, the United States 

government has instituted civil forfeiture proceedings based 

upon IFS-NJ’s violation of 18 U.S.C. S 1955. As noted 

above, S 1955 is a criminal statute that is part of the 

Organized Crime Control Act. That Act is "a federal law 

that, among other things, defines certain federal crimes 

over which the district courts have exclusive jurisdiction." 

Cabazon Band of Mission Indians, 480 U. S. at 213. We are 

therefore concerned with an exercise of federal, not state, 

authority. Moreover, as noted above, the forfeiture action is 

predicated solely upon conduct that occurred in New 

Jersey. Claimants are therefore actually arguing that the 

laws of England insulate them from forfeiture based upon 

their conduct in New Jersey.19 We reject that argument. 

The Claimants next argue that this forfeiture proceeding 

is essentially being waged against an innocent, foreign 

citizen and his gambling companies. However, this action 

does not turn on the culpability of Bowman or his British 

or Canadian companies. Moreover, as we noted earlier, 

forfeiture is not conditioned upon the culpability of the 

owner of the defendant property. We reiterate: the 

"innocence of the owner is irrelevant" in a civil forfeiture 

proceeding. Sandini, 816 F.2d at 872. Therefore, the legality 

and/or licensure of the businesses in England is simply 

irrelevant to the issues raised in the instant forfeiture 

proceeding.20 

_________________________________________________________________ 

19. Inasmuch as IFS-NJ’s accounts are subject to forfeiture based solely 

upon IFS-NJ’s conduct, this case does not raise any issue of whether 

IFS-NJ is the alter ego of Bowman or his companies in Canada or the 

United Kingdom as Claimants suggest. See Claimants’ Br. at 6. 

20. As we noted in United States v. Sandini , civil in rem forfeiture 

proceedings "enjoy a venerable history and existed in Mosaic law if not 

 22 

 

Claimants’ also attempt to draw substance from the rule 

of lenity. "The main function of the rule of lenity is to 

protect citizens from the unfair application of ambiguous 

punitive statutes." United States v. Thompson/Center Arms 

Co., 504 U. S. 505, 525 (1992) (Stevens, J., dissenting). 

Therefore, where a statute is punitive in nature, the rule of 

lenity requires that any ambiguity in the statute be resolved 

in favor of the claimant. One 1973 Rolls Royce , 43 F.3d at 

801. Claimants argue that even if a "technical violation of 
S 1955 could have been made out," the rule of lenity 

nevertheless precludes forfeiture under the circumstances 

here. Claimants’ Br. at 26. This argument is twofold. First, 

Claimants seize upon the district court’s statement that 

"there is no law directly defining the criminality of the 

conduct in question." App. at 9. Second, they argue that 

the district court incorrectly held that the rule of lenity 

does not apply to civil forfeiture proceedings. They insist 

that this forfeiture was punitive and therefore the rule of 

lenity should apply.21 

We interpret the first prong of this argument as an 

assertion that the district court believed that there was no 

New Jersey case law from which it could determine if IFSNJ’s activities constituted a violation of N.J.S.A. 2C:37- 

2a(2). However, the rule of lenity applies only if there is a 

"grievous ambiguity or uncertainty in the statute." 

Muscarello v. United States, 524 U.S. 125, 138 

(1998)(citation and internal quotations omitted). The 

_________________________________________________________________ 

in other ancient codes as well." 816 F.2d at 872. Therefore, "[h]owever 

inapplicable its original justification may be today, in rem, or civil 

forfeiture, has become ‘too firmly fixed in the punitive and remedial 

jurisprudence of the country to be now displaced.’ " Id. (quoting 

Goldsmith-Grant Co. v. United States, 254 U. S. 505, 511 (1921)). 

21. While civil forfeitures are usually not regarded as punishment, 

Sandini, at 872-873, certain kinds of civil forfeitures can indeed be 

punitive. In Austin v. United States, 509 U. S. 602, 619-620 (1993), the 

Court held that civil drug forfeitures under 21 U.S.C. SS 881(a)(4) and (7) 

are punishment under the Eight Amendment’s Excessive Fines Clause. 

See also United States v. One 1973 Rolls Royce, 43 F.3d 794, 819 

(1994)(Section 881(a)(4) forfeiture "is punitive and quasi-criminal in 

nature."). 

 23 

 

parameters of New Jersey’s prohibition against promoting 

gambling are not ambiguous, and they are certainly not 

"grievous[ly]" ambiguous. New Jersey’s statute plainly 

includes conduct that materially aids any form of gambling 

activity, and it even provides examples of such conduct. 

This portion of Claimants’ argument really does not 

implicate the rule of lenity as much as it simply reiterates 

their belief that IFS-NJ’s activities are beyond New Jersey’s 

reach because the bets were accepted in England. 

Moreover, the mere possibility that New Jersey’s 

promoting gambling statute lends itself to a more narrow 

interpretation than the district court allowed (or that the 

New Jersey court gave it in Fiola), does not trigger the rule 

of lenity. Smith v. United States, 508 U. S. 223, 240 (1993) 

(Noting that the possibility of articulating a narrower 

construction of a statute does not make the rule of lenity 

applicable). 

We also reject the second prong of Claimants’ rule of 

lenity argument; the district court’s statement that the rule 
does not apply in a civil proceeding. That was not the 

district court’s holding. Rather, the district court merely 

noted that Claimants had failed "to cite any authority for 

the argument that the rule of lenity is applicable in a 

forfeiture proceeding because of criminality of the 

underlying conduct may be a matter of dispute." App. at 

13. We have held that the rule of lenity does apply in a civil 

forfeiture proceeding when the nominally civil forfeiture 

statute is actually "punitive and quasi-criminal in nature." 

One 1973 Rolls Royce, 43 F.3d at 819. 

However, even when the punitive nature of a civil 

forfeiture is sufficient to apply the rule of lenity, the rule 

will still not apply where there is little more than a 

suggestion of ambiguity. "[M]ost statutes are ambiguous to 

some degree . . . . [however,] the rule of lenity only applies 

if, after seizing everything from which it can be derived, we 

can make no more than a guess as to what Congress 

intended." United States v. Muscarello, 524 U.S. at 138 

(citations and internal quotations omitted). "[A]s is true of 

any guide to statutory construction, [the rule] only serves 

as an aid for resolving an ambiguity; it is not to be used to 

beget one." Callanan v. United States, 364 U.S. 587, 596 

 24 

 

(1961). "The rule comes into operation at the end of the 

process of construing what Congress expressed, not at the 

beginning . . . ." Id. Here, we have no problem determining 

Congress’s intent from the text of S 1955(1). 

The Claimants’ rule of lenity objection to this proceeding 

is nothing more than an invitation to read ambiguity into 

an unambiguous statute based on their perception that it 

is being applied unfairly. We will not accept Claimants’ 

invitation to manufacture an ambiguity merely to achieve a 

result which they believe is fairer than the result required 

by the breadth of the statute. 

Claimants’ remaining assertion is based upon 

international law. They claim the seizure and subsequent 

forfeiture violate the "Treaty Between the Government of the 

United States of America and the Government of the United 

Kingdom of Great Britain and Northern Ireland on Mutual 

Legal Assistance in Criminal Matters" ("MLAT"). According 

to Claimants, under the MLAT, the United States was 

obligated to consult with the United Kingdom’s Home 

Secretary before seizing the accounts. They also claim that 

the United States did not exhaust certain procedures as 

required by the treaty. We again disagree. 

The United States and the United Kingdom entered into 

the MLAT which became effective on December 2, 1996. 

According to the treaty’s Preamble, the parties entered into 

that treaty to "improve the effectiveness of the law 

enforcement authorities of both countries in the 

investigation, prosecution, and combating of crime through 

co-operation and mutual legal assistance in criminal 

matters." App. at 116. The treaty is primarily concerned 
with drug trafficking, and related offenses, and seizure and 

forfeiture of proceeds and instrumentalities related to drug 

trafficking. Id. The parties to the treaty intended to allow 

the United States and the United Kingdom to "develop and 

share evidence . . . to facilitate criminal prosecutions 

abroad." United States v. Balsys, 524 U.S. 666, 715 (1998) 

(Breyer, J., dissenting). However, the treaty explicitly states 

that it is not intended to provide a private remedy. It states 

in pertinent part: 

 [t]his Treaty is intended solely for mutual legal 

 assistance between the Parties. The provisions of this 

 25 

 

 Treaty shall not give rise to a right on the part of any 

 private person to obtain, suppress, or exclude any 

 evidence, or to impede the execution of a request. 

App. at 116. (emphasis added). Therefore, even it if is 

assumed for argument’s sake that the United States 

violated the MLAT, Claimants have no private right to 

enforce its terms. 

Claimants’ essential claim is that the district court had 

no jurisdiction to apply United States gambling law to a 

British citizen and British companies operating legal 

gambling businesses on English soil. To support that 

argument, they cite Zoelsch v. Arthur Anderson & Co., 824 

F.2d 27 (D.C. Cir. 1987). However, to the extent it applies, 

we believe Zoelsch actually supports the district court’s 

exercise of jurisdiction. There, in affirming the district 

court’s dismissal for lack of subject matter jurisdiction, the 

court of appeals stated: "[J]urisdiction is appropriate when 

the fraudulent statements or misrepresentations originate 

in the United States, are made with scienter and in 

connection with the purchase and sale of securities, and 

‘directly cause’ the harm to those who claim to be 

defrauded, even if reliance and damages occur elsewhere." 

Id. at 33. The court concluded that these jurisdictional 

prerequisites "are only a slight recasting, if at all, of the 

traditional view that jurisdiction will lie in American courts 

only over proscribed acts done in this country." Id. 

Claimants argue that Zoelsch stands for the proposition 

that "federal securities law does not apply to conduct in the 

United States that was merely preparatory to an alleged 

securities violation which occurred overseas." Reply Br. at 

18. They then attempt to draw parallels to the S 1955(d) 

forfeiture by arguing that IFS-NJ’s activities in New Jersey 

were merely "preparatory" to legal gambling activities in 

England, and they conclude that the district court therefore 

lacked jurisdiction under Zoelsch. 

However, Zoelsch affirms that American courts have 

jurisdiction "over proscribed acts done in this country[ ]" 

that have the required nexus to activities elsewhere. We 

therefore find no merit in Claimants’ jurisdictional 

challenge to this in rem proceeding over New Jersey 
 26 

 

property based upon conduct occurring in New Jersey. It 

may well be true that British citizens and British 

companies will be affected by this in rem action in New 

Jersey. This does not mean that the law of New Jersey or 

the law of the United States is being applied to those 

citizens or companies. 

Claimants’ international exhaustion argument arises 

from the fact that both the United States and England 

belong to the Organization of Economic Cooperation and 

Development ("OECD"). Claimants argue that the OECD 

requires "consultation and moderation by the U.S. in this 

context." Claimants’ Br. at 39-40. However, Claimants 

never bother to explain how the government’s institution of 

this forfeiture violated requirements of international law or, 

if a violation occurred, how it provides a defense from this 

forfeiture action. 

In a related argument, Claimants insist that 

considerations of international comity preclude the instant 

forfeiture. That contention is again bottomed on the 

Claimants’ belief that the forfeiture is an extraterritorial 

application of federal law against British citizens. We have 

already explained why there is no extraterritorial 

application of federal law to British citizens here. 

Claimants also think it significant that S 1955 was 

originally aimed at organized crime, that Bowman’s 

businesses are entirely legal in England, and that gambling 

no longer is regarded as the evil it once was in the United 

States. Indeed, argue Claimants, the fact that New Jersey 

itself has legalized casinos and lotteries plainly 

demonstrates that gambling is no longer associated with 

vice. Thus, the argument continues, comity required the 

district court to defer to Bowman’s British licenses to 

conduct a gambling enterprise. However, the change in 

society’s views towards gambling does not offer the district 

court a license to ignore a federal statute (or the state 

statute it incorporates) under the guise of international 

comity. 

 Comity, . . . is the recognition which one nation allows 

 within its territory to the legislative, executive, or 

 judicial acts of another nation, having due regard both 

 27 

 

 to international duty and convenience, and to the 

 rights of its own citizens or of other persons who are 

 under the protections of its laws. 

* * * 

 Comity cannot be the source of a disability that 

 prevents a district court from having the power to 
 address wrongdoing that impacts a domestic court. . . . 

Republic of the Philippines v. Westinghouse Elec. Corp., 43 

F.3d 65, 75 (3d Cir. 1995) (emphasis in original)(citations 

and internal quotations omitted). Congress prohibited 

illegal gambling businesses as defined under state law, and 

authorized forfeiture of related property. We have already 

discussed how the relevant state law defines gambling 

broadly to include any conduct that materially aids any 

form of gambling activity. These legislative enactments 

reflect the "strong public policies" of the United States 

government, and the government is not required to tolerate 

activity that it defines as illegal merely because it affects 

someone who may live in a country where the activity is 

legal. 

IV. CONCLUSION 

For all of the above reasons, we will affirm the district 

court’s grant of summary judgment to the government and 

its final order of forfeiture. 

A True Copy: 

Teste: 

 Clerk of the United States Court of Appeals 

 for the Third Circuit 

 28