United States District Court, D. Columbia.
NANCY PRESTON, Defendant: Jonathan Shapiro, LEAD ATTORNEY,
PRO HAC VICE, GREENSPUN, SHAPIRO, DAVIS & LEARY, P.C.,
Fairfax, VA; Peter D. Greenspun, LEAD ATTORNEY, GREENSPUN
SHAPIRO, PC, Fairfax, VA.
JAMES PRESTON, LAURA PRESTON, Movants: Mariam Wagih Tadros,
LEAD ATTORNEY, REES BROOME, PC, Tysons Corner, VA.
USA, Plaintiff: Virginia Cheatham, LEAD ATTORNEY, U.S.
ATTORNEY'S OFFICE FOR THE DISTRICT OF COLUMBIA,
Washington, DC; Anthony D. Saler, U.S. ATTORNEY'S OFFICE,
Criminal Division, Washington, DC.
Document No.: 59
Government's Motion to Dismiss Laura Preston's
CONTRERAS, United States District Judge.
Nancy Preston (" Ms. Preston" ) was convicted of
Mail Fraud in violation of 18 U.S.C. § 1341, and on
December 12, 2014, this Court entered a Final Order of
Forfeiture forfeiting $239,069 to the United States in the
form of a money judgment pursuant to 18 U.S.C. §
981(a)(1)(C) and 28 U.S.C. § 2461(c). See Final
Order of Forfeiture (" Final Order" ), ECF No. 22.
On June 17, 2014, the Court amended the Final Order pursuant
to Federal Rule of Criminal Procedure 32.2(e)(2)(A) to
include as substitute property pursuant to 21 U.S.C. §
853(p) cash in one Merrill Lynch account held by Ms.
Preston's husband, James Preston, and certain securities
in a separate Merrill Lynch account held by the James W.
Preston Trust (the " Trust" ). See Fourth
Amended Order of Forfeiture (" Fourth Amended
Order" or " Order of Forfeiture" ), ECF No.
43. On July 29, 2014, James Preston filed a Petition
asserting an interest in the substitute property pursuant to
Federal Rule of Criminal Procedure 32.2 and 21 U.S.C. §
853(n). See James W. Preston's Petition
Asserting an Interest in Property (" Mr. Preston's
Petition" ), ECF No. 48. On August 25, 2014, Laura
Preston, the daughter of Mr. Preston and alleged beneficiary
of the Trust Account, filed a separate Petition asserting an
interest in the substitute property held by the Trust which
incorporates Mr. Preston's Petition in its entirety.
See Laura Preston's Co-Petition Asserting an
Interest in Property (the " Petition" ), ECF No.
Government has filed a motion to dismiss the Petition.
See Mot. Dismiss Laura Preston's Co-Petition
(" Motion to Dismiss" ), ECF No. 59. For the
reasons explained below, the Court will grant the
approximately 1992 to September 2011, Ms. Preston was the
Corporate Controller for Clyde's Restaurant Group ("
Clyde's" ). See Statement of the Offense at 1, ECF
No. 6. On January 9, 2012, Ms. Preston confessed to agents of
the Federal Bureau of Investigation (" FBI" ) that
she had embezzled hundreds of thousands of
dollars from Clyde's. See Decl. Supp. Gov't's
Mot. Amend Order Forfeiture ¶ 4, ECF No. 42-1.
statement for Merrill Lynch account number XXX-X3888 held by
the Trust (the " Trust Account" ) indicates that
the Trust was formed under an agreement dated eleven days
after Ms. Preston's confession. See Mr.
Preston's Petition Ex. 3, ECF No. 48-1. Laura Preston
alleges that she is the beneficiary of the Trust Account and
that Mr. Preston is the trustee of the Trust Account.
See Petition at 1. Three days later, on January 23,
2012, various securities (the " Securities" ) were
transferred from Merrill Lynch account number XXX-X1295 held
by Ms. Preston (" Ms. Preston's 1295 Account" )
to a separate account held by Mr. Preston, Merrill Lynch
account number XXX-X1299 (" Mr. Preston's 1299
Account" ). Mr. Preston's Petition at 2; Mr.
Preston's Petition Ex. 1 at 10. In his Petition, Mr.
Preston alleges that " [t]he reason for the transfers is
simple: Once Merrill Lynch discovered Mrs. Preston's
criminal activity, it closed her account, forcing Mrs.
Preston to transfer her funds to Mr. Preston's
account." Mr. Preston's Petition at 2. Soon