Opinion ID: 198294
Heading Depth: 3
Heading Rank: 1

Heading: Forfeiture of a Substitute Asset

Text: 125 A criminal forfeiture order may take several forms. First, the government is entitled to an in personam judgment against the defendant for the amount of money the defendant obtained as proceeds of the offense. Second, to the extent the government can trace any of the proceeds to specific assets, it may seek the forfeiture of those assets directly pursuant to 21 U.S.C. § 853(a)(1). Third, if as a result of some act or omission of the defendant, the government cannot trace the proceeds to specific assets, it may seek the forfeiture of any property, cash or merchandise, in satisfaction of the amount of criminal forfeiture to which it is entitled. United States v. Voigt, 89 F.3d 1050, 1088 (3d Cir.1996); see 21 U.S.C. § 853(p) (authorizing forfeiture of substitute assets). 126 In Voigt, the Third Circuit held that a defendant convicted of laundering $1.6 million was required to forfeit that amount as a money judgment. See 89 F.3d at 1084. When the government could not directly trace any forfeitable proceeds to the defendant's current assets, the court held that the government could satisfy the $1.6 million judgment by seeking forfeiture of the defendant's assets as substitute assets. See id. at 1088. 127 Similarly, in this case, the district court ordered forfeiture of the Montanez property as a substitute asset to satisfy, at least in part, the $6,000,000 money judgment set forth in the preliminary order of forfeiture because the government established that it could not trace any of the criminal proceeds into any of the defendant's current assets. 128 In this context, failure to establish any nexus between the MONTANEZ property and the conspiracy is irrelevant. In fact, such a nexus would render forfeiture of the property as a substitute asset unnecessary. See Voigt, 89 F.3d at 1086 ([t]he substitute asset provision comes into play only when forfeitable property cannot be identified as directly 'involved in' or 'traceable to' [the criminal activity]). 129 To obtain an order forfeiting property as a substitute asset, the government need only comply with the requirements of § 853(p). In particular, substitute assets may be forfeited if the government shows that, as a result of any act or omission of the defendant, the forfeitable property (1) cannot be located upon the exercise of due diligence; [or] (2) has been transferred or sold to, or deposited with, a third party. § 853(p)(1) & (2). 130 Here, the government complied with § 853(p) by submitting a motion and affidavit that recited the efforts the government had made to locate the proceeds of the drug conspiracy that would have been directly forfeitable under § 853(a). See Defendant's App. at 121-24 (Affidavit of Special Agent Felicia Ramos-Andino). The affidavit concluded that Reyes-Padilla had dissipated or otherwise disposed of the proceeds of her drug trafficking, id. at 123, so that the proceeds could not, despite the exercise of due diligence, be located. See id. at 123-24. Based on this record, it was not error for the district court to order the forfeiture of other property of the defendant, § 853(p), up to the amount described in the money judgment. See § 853(p); United States v. Hurley, 63 F.3d 1, 23-24 (1st Cir.1995) (affirming forfeiture of substitute assets under identical provision in 18 U.S.C. § 1963(m)).