defendants forfeited to the United States their ownership interests in all property located in the United States, including, without limitation, real property and all tangible and intangible personal property, however held, whether subsequently identified, determined or discovered in the course of the ongoing liquidation proceedings described therein or otherwise identified, determined, or discovered in any manner at any time (excluding property brought into the United States by or on behalf of Court-Appointed Fiduciaries of BCCI in the course of the management or disbursement of the liquidation estates). Attached to the First Order of Forfeiture, as amended, was a list of BCCI accounts, with corresponding numbers, names, and approximate balances, which the United States Marshals Service was directed to seize forthwith. Included among the assets seized were four BCCI accounts at Capital Bank (Nos. 902205102, 0902205110, 085-0053580 and 902204122) with an aggregate balance of US $ 4,024,342 (hereinafter, the "forfeited accounts").
The Plea Agreement also established the Worldwide Victims Fund and the U.S. Fund. Under the terms of the Plea Agreement, forfeited assets were to be disbursed in equal amounts to the Worldwide Victims Fund and the U.S. Fund. See Plea Agreement P11(c). The broad purpose of the Worldwide Victims Fund, operated by the Court-Appointed Fiduciaries, is to distribute funds "only to innocent depositors, creditors and other victims of BCCI whose claims are not derived directly or indirectly through violations of United States or other laws concerning narcotics, terrorism, money laundering, crimes of violence, or other acts generally recognized as felonies or similar crimes under the law of countries subscribing to recognized norms of international justice." Id. P14.
The purpose of the U.S. Fund is more specific, but no less compensatory. In addition to allowing for reimbursement of the costs of investigation and prosecution of BCCI, bank insurance and other matters, the U.S. Fund is also available to provide "restitution to victims of BCCI, which may include remission to the Court Appointed Fiduciaries in accordance with 18 U.S.C. § 1963(g) for the purpose of facilitating an increase in assets available for distribution by the Court-Appointed Fiduciaries to innocent worldwide victims of BCCI, and which may include claims related to the failure of Cen Trust, if any." Id. P12(f). As a result of BCCI's guilty plea and the subsequent criminal forfeiture proceedings, by July 1996 the United States had "recovered nearly $ 800 million, virtually all of which has been, or will be, distributed to the victims of the fraud." Testimony of Stefan Cassella before the Judiciary Committee of the House of Representatives (July 22, 1996), 1996 WL 410099, *5 (F.D.C.H.).
After this Court entered the First Order of Forfeiture, which included the forfeited accounts at Capital Bank, the United States provided notice by publication and by letters to potential claimants of which it was aware. Through a timely filed L-Claim that followed, Capital Bank contends that by virtue of its right to set off and due to contingent liabilities arising from letters of credit confirmed but not paid by BCCI agencies, it is entitled to a sum that is expected to exceed US $ 1,139,910.80. See L-Claim PP2 & 4. Additionally, the petitioner asserts a claim based on its status as a general creditor
and a bona fide purchaser for value.
The United States later filed the instant motion to dismiss on the grounds of ripeness, lack of standing and failure to state a claim upon which relief can be granted. As to the claim based upon contingent liabilities with BCCI, the government argues that Capital Bank's petition is unripe. Additionally, the government contends that Capital Bank, as a general creditor, lacks standing. On the merits, the government states that the petitioner has failed to state a claim upon which relief can be granted because it lacks a legal interest in a specific asset as required by 18 U.S.C. § 1963(l)(6)(A), and it is not a bona fide purchaser for value under 18 U.S.C. § 1963(l)(6)(B).
BCCI's assets were forfeited pursuant to 18 U.S.C. § 1963,
which sets forth an orderly procedure by which third parties seeking to recover interests in forfeited property may obtain judicial resolution of their claims. It permits any person, other than the defendant, claiming a legal interest in forfeited property to petition the Court for a hearing to adjudicate the validity of that interest. 18 U.S.C. § 1963(l)(2).
Section 1963(l)(6) sets forth the substantive elements that a third party must establish to obtain amendment of an order of forfeiture:
If, after the hearing, the court determines that the petitioner has established by a preponderance of the evidence that--
(A) the petitioner has a legal right, title, or interest in the property, and such right, title, or interest renders the order of forfeiture invalid in whole or in part because the right, title, or interest was vested in the petitioner rather than the defendant or was superior to any right, title, or interest of the defendant at the time of the commission of the acts which gave rise to the forfeiture of the property under this section; or