United States District Court, D. Columbia.
FLORENCE BIKUNDI, also known as FLORENCE NGWE, also known as
FLORENCE IGWACHO, Defendant: William R. Martin, LEAD
ATTORNEY, Kerry Brainard Verdi, Sasha Elizabeth H.W. Battle,
MARTIN & GITNER, PLLC, Washington, DC.
USA, Plaintiff: Theodore L. Radway, LEAD ATTORNEY, Anthony D.
Saler, Lionel Andre, UNITED STATES ATTORNEY'S OFFICE,
Washington, DC; Dangkhoa T. Nguyen, U.S. ATTORNEY'S
OFFICE FOR THE DISTRICT OF COLUMBIA, Fraud and Public
Corruption Section, Washington, DC; Michael Justin Friedman,
U.S. DEPARTMENT OF JUSTICE, Washington, DC.
A. HOWELL, United States District Judge.
defendant Michael Bikundi, Sr. (" the defendant" ),
his wife, Florence Bikundi, and others, are charged in a
multi-count Superseding Indictment for participating in an
alleged scheme to defraud the District of Columbia Medicaid
Program. Incident to the government's investigation and
prosecution of the defendant and his alleged co-conspirators,
the government seized significant assets alleged to have been
derived from or otherwise involved in the charged offenses.
Now pending before the Court is the defendant's motion to
partially the seizure of certain of these assets in order to
release a total of $132,165.00 seized from four domestic bank
accounts and one foreign bank account (the " Disputed
Funds" ). See Def.'s Mot. Vacate Seizure
Warr. (" Def.'s Mot." ), ECF No. 149. In
conjunction with his motion, the defendant has requested a
pretrial hearing to challenge the sufficiency of the
government's evidence supporting the seizure of these
funds. Id. at 1. For the reasons stated below, the
defendant's request for a pretrial hearing is denied and
the defendant's motion to vacate partially the seizure
warrants is denied in part and granted in part.
February 18, 2014, a U.S. Magistrate Judge of this Court
issued seizure warrants for property, including sixty-four
financial accounts and five vehicles, based upon a 136-page
affidavit alleging probable cause to believe that the
property was subject to criminal forfeiture (1) as property
" involved in a transaction or attempted transaction in
violation of" federal criminal money laundering
statutes, and (2) as property " derived, directly or
indirectly, from gross proceeds traceable to the commission
of a Federal health care offense," pursuant to 18 U.S.C.
§ § 982(a)(1) and (a)(7), respectively. Affidavit
in Support of Seizure Warrants, dated February 18, 2014
(" First Aff." ) ¶ ¶ 348-49, ECF No.
238-1. The affidavit also alleged probable
cause to believe that the listed property was subject to
civil forfeiture, pursuant to 18 U.S.C. § §
981(a)(1)(A) and (a)(1)(C). Id.
following day, a grand jury indicted co-defendant Florence
Bikundi on multiple counts of health care fraud and money
laundering. Indictment, ECF No. 1. After further
investigation, the grand jury returned a Superseding
Indictment, on December 18, 2014, against eight additional
defendants, including Michael Bikundi, who is charged with
Conspiracy to Commit Health Care Fraud, in violation of 18
U.S.C. § 1349 (Count One); Health Care Fraud, in
violation of 18 U.S.C. § 1347 (Count Two); Money
Laundering Conspiracy, in violation of 18 U.S.C. §
1956(h) (Count Fifteen); Laundering of Monetary Instruments,
in violation of 18 U.S.C. § 1956(a)(1)(B)(i) (Counts
Sixteen through Twenty-Two); and Engaging in Monetary
Transactions in Property Derived from Specified Unlawful
Activity, in violation of 18 U.S.C. § 1957 (Counts
Twenty-Three through Twenty-Five). See Superseding
Indictment, ECF No. 44.
the original indictment contained a " Criminal
Forfeiture Allegation" seeking forfeiture of a real
property parcel in Mitchellville , Maryland, and a general
money judgment " in the amount of at least
$75,000,000," Indictment, Crim. Forfeiture Alleg. ¶
¶ 1-2, the Superseding Indictment includes a more
detailed " Forfeiture Allegation." Superseding
Indictment, Forfeiture Alleg. Specifically, the Superseding
Indictment seeks forfeiture, upon conviction of the health
care fraud offenses alleged in Counts One, Two, Thirteen, or
Fourteen, of a money judgment " of at least
$75,000,000," as well as eighty-seven listed
properties--for which " the Grand Jury finds by probable
cause . . . [are] subject to forfeiture," under 18
U.S.C. § 982(a)(7). Id., Forfeiture Alleg.
¶ 1. The listed properties consist of six pieces of
diamond jewelry, the real property parcel in
Mitchellville , Maryland, as well as almost $73,000 in cash
seized from that home, five vehicles, and funds held in
seventy-four bank or other financial accounts, including the
four domestic bank accounts at issue in the instant motion.
Id. The Forfeiture Allegation further seeks
forfeiture, without a specific grand jury probable cause
finding, of property (1) " that constitutes or is
derived, directly or indirectly, from gross proceeds
traceable to" false statements in the submission of
payment claims to the D.C. Medicaid Program, as charged in
Counts Three through Twelve, under 18 U.S.C. §
982(a)(7), id. ¶ 2;  and (2) that is "
involved in" the money laundering offenses charged in
Counts Fifteen through Twenty-Five, or " any property
traceable to such property," under 18 U.S.C. §
982(a)(1), id. ¶ 3.
September 5, 2014, a U.S. Magistrate Judge of this Court
issued a second seizure warrant based upon a 15-page
affidavit alleging probable cause to believe that five
additional bank accounts held at Banque Internationale du
Cameroun pour l'Epargne et le Credit (" BICEC"
) in Cameroon, including the foreign account at issue in the
instant motion, were subject to both civil and criminal
forfeiture, as property " traceable to" federal
health care fraud and " involved in a transaction or
attempted transaction in violation of" a federal money
laundering offense, pursuant to 18 U.S.C. § §
981(a)(1)(C) and 982(a)(1). Affidavit in Support of Seizure
Warrants, dated September 5, 2014 (" Second Aff." )
¶ ¶ 1, 33, ECF No. 245-1.
government subsequently filed a Notice of Bill of Particulars
for the Forfeiture Allegation in the Superseding Indictment
identifying the five BICEC bank accounts listed in the Second
Affidavit as subject to criminal forfeiture under 18 U.S.C.
§ 982(a)(7), upon conviction of an offense alleged in
Counts Three through Twelve. Bill of Particulars ¶ A,
ECF No. 119. The Bill of Particulars also listed ninety-two
specific properties, including the eighty-seven properties
identified in the Forfeiture Allegation as well as the five
newly identified BICEC accounts, as subject to criminal
forfeiture under 18 U.S.C. § 982(a)(1) upon conviction
of an offense alleged in Count Fifteen. Id. at
defendant now seeks the release of a total of $132,165.00
previously held in four domestic bank accounts seized
pursuant to the first seizure warrant and one of the BICEC
accounts seized pursuant to the second seizure warrant.
Def.'s Mot. at 3-5. The First Affidavit designates the
four domestic accounts containing Disputed Funds as Accounts
H, I, W and AA. First Aff. ¶ 1. For each account, the
First Affidavit identifies a total amount of funds traceable
to Medicaid payments. Id. ¶ ¶ 234, 236,
238, 240. In contrast to the traceable funds, however, the
lists " other" funds that are not alleged to be
traceable to Medicaid payments. Id. Specifically,
the First Affidavit alleges the following with regard to each
■ Account H: Between November 2009 and December 2013,
approximately $317,241.06 was deposited into this account.
Id. ¶ 234. The First Affidavit alleges that
$309,729.20 of these funds are traceable to Medicaid
payments, but that " [o]ther deposits to the account
include $7,200.00 in cash and $311.86 in interest earned on
the account." Id.
■ Account I: Between November 2009 and January 2014,
approximately $634,929.06 was deposited into this account.
Id. ¶ 236. The First Affidavit alleges that
$588,664.97 of these funds are traceable to Medicaid
payments, but that " [o]ther deposits to the account
include $5,500.00 deposited from third parties, $29,500.00 in
cash deposits, and the deposit of a $10,000 cashier's
■ Account W: Between March 2012 and November 2013, at
least $140,756.66 was deposited into this account.
Id. ¶ 238. The First Affidavit alleges that
$123,688.94 of these funds are traceable to Medicaid
payments, but that " [t]he rest of the funds deposited
into this account consist of $8,750.00 in checks from third
parties, $8,100.00 in cash, and $217.72 in interest."
■ Account AA: Between March 2012 and November 2013, at
least $464,771.16 was deposited into this account.
Id. ¶ 240. The First Affidavit alleges that
$430,360.00 of these funds are traceable to Medicaid
payments, but " [o]ther deposits to the account include
$17,500.00 in cash, $15,615.00 from the sale of a vehicle,
and $126.16 in interest." Id.
the defendant seeks release of Disputed Funds from a seized
BICEC account, XXX-121. Def.'s Mot. at 4-5. The Second
Affidavit alleges that this account received deposits between
May 12, 2008, when the defendant opened the account, and
April 4, 2013, that originated in bank accounts referred to
as Accounts AA and HHH in the First Affidavit. Second Aff.
¶ 14-17. To support the seizure of funds held in the
BICEC account, the Second Affidavit incorporates the First
Affidavit's allegations regarding Account AA and further
alleges that Account HHH received funds traceable to Medicaid
prior to being closed in March 2012. Id. The
government has advised that the funds from BICEC account
XXX-121 were transferred to a U.S. Department of Treasury
Suspense Account on May 29, 2015. Gov't Supp. Br.
Def.'s Mot. Vacate Seizure Warr. (" Gov't Supp.
Br." ) at 2-3, ECF No. 244.
that the First Affidavit explicitly indicates that certain
seized funds are not directly traceable to any alleged
illegal conduct, the defendant asserts that the government
has failed to establish probable cause that the Disputed
Funds were subject to seizure and asks the Court to order
their release. Def.'s Mot. at 1-5. In total, the
defendant requests the release of $102,165.00 from the four
domestic accounts comprised of the following funds: (1)
$62,300.00 in cash deposits; (2) $10,000.00 in cashier's
check deposits; (3) $14,250.00 in deposits from checks issued
by unidentified third parties; and (4) $15,615.00 in proceeds
from the sale on an unspecified date of an unidentified
vehicle. Id. at 4.
defendant likewise seeks $30,000.00 seized from the BICEC
account, which funds the defendant asserts was transferred
into that account from Account AA. Id. at 4-5. The
defendant contends that
these funds are not subject to seizure because " Account
AA held funds that are not traceable to Medicaid,"
id. at 5, namely, the " [o]ther deposits to the
account include $17,500.00 in cash, $15,615.00 from the sale
of a vehicle," First Aff. ¶ 240. As the government
correctly notes, however, the defendant has double-counted
the BICEC funds in calculating the total amount he seeks to
have released, since the same Disputed Funds that are at
issue from Account AA were transferred to the BICEC account.
Gov't Supp. Br. at 3 n.6. Thus, the remaining discussion
will address only the Disputed Funds seized from the four
threshold matter, the defendant asserts that access to the
Disputed Funds is necessary to meet the costs of his "
household necessities," not to pay for his defense
against the criminal charges. Def.'s Mot. at 1.
Consequently, he raises no Sixth Amendment claim that the
seizure of the Disputed Funds implicates his right to
counsel. Id. at 9 n.1; Def.'s Reply Gov't
Opp'n Def.'s Mot. Vacate Seizure Warr. ("
Def.'s Reply" ) at 1-2, ECF No. 195. Nonetheless,
the defendant argues that examination of the First Affidavit
reveals that the Disputed Funds " are not traceable to
Medicaid[,]" " are not part of the indicted
offenses[,]" and " have absolutely no nexus to the
criminal activity alleged in the indictment." Def.'s
Reply at 2. Citing Kaley v. United States, 134 S.Ct.
1090, 188 L.Ed.2d 46 (2014), the defendant asserts that the
continued seizure of the Disputed Funds violates the Due
Process Clause of the Fifth Amendment and requests a pretrial
hearing to determine their traceability to the charged
criminal conduct. Id. at 1-2.
initial and supplemental responses to the defendant's
motion, the government objects to the defendant's request
for the partial release of the Disputed Funds and for a
pretrial hearing on their traceability to the charged
offenses. The government's opposition rests principally
on the following grounds: (1) the defendant's right to
challenge the forfeitability of the disputed assets is
limited to the post-trial procedures provided by Federal Rule
of Criminal Procedure 32.2, Gov.'t Opp'n Def.'s
Mot. Vacate Seizure Warr. (" Gov't Opp'n" )
at 6-9, ECF No. 194; (2) the defendant has failed to
demonstrate that a pretrial hearing is required under the Due
Process framework outlined in Mathews v. Eldridge,
424 U.S. 319, 96 S.Ct. 893, 47 L.Ed.2d 18 (1976),
id. at 9-16; and (3) the defendant has failed to
make a threshold showing that he requires the Disputed Funds
to pay for ordinary and necessary living expenses,
id. at 17-20. These arguments are addressed
seriatim below, following review of the legal
principles applicable to pretrial seizure of property pending
final disposition of criminal charges.
LEGAL FRAMEWORK APPLICABLE TO PRETRIAL SEIZURE OF POTENTIALLY
Supreme Court has long recognized the " strong
governmental interest in obtaining full recovery of all
forfeitable assets." Caplin & Drysdale, Chartered v.
United States, 491 U.S. 617, 631, 109 S.Ct. 2646, 109
S.Ct. 2667, 105 L.Ed.2d 528 (1989). Forfeiture serves
important punitive and deterrence functions, and forfeited
property often is put to productive use in assisting crime
victims and improving communities damaged by criminal
behavior. See Kaley, 134 S.Ct. at 1094
(citing Caplin & Drysdale, 491 U.S. at 629-630).
case, the government argues that the Disputed Funds are
subject to seizure
pursuant to two provisions of the criminal forfeiture
statute. First, the government contends that probable cause
exists to believe that the disputed assets are subject to
forfeiture under 18 U.S.C. § 982(a)(7), which requires
the forfeiture of all property " that constitutes or is
derived, directly or indirectly, from gross proceeds
traceable to" a " Federal health care
offense." Gov't Supp. Br. at 4. Alternatively, the
government argues that there is probable cause to believe
that the Disputed Funds are subject to forfeiture under 18
U.S.C. § 982(a)(1), which requires forfeiture from a
defendant convicted of a federal money laundering offense of
any property " involved in such offense, or any property
traceable to such property." Id.
forfeiture proceedings under these provisions, including
pretrial seizure of property subject to forfeiture upon
conviction, are governed by 21 U.S.C. § 853,
see 18 U.S.C. § 982(b)(1), as well as Federal
Rule of Criminal Procedure 32.2. Under 21 U.S.C. § 853,
the government may request a warrant from a federal court
authorizing the pretrial seizure of property subject to
forfeiture " in the same manner as provided for a search
warrant." 21 U.S.C. § 853(f). The court "
shall" issue such a warrant upon determining that there
is " probable cause to believe that the property to be
seized would, in the event of conviction, be subject to
forfeiture and that [other authorized forms of protective
orders] may not be sufficient to assure the availability of
the property for forfeiture." Id.
the government has obtained a seizure warrant pursuant to 21
U.S.C. § 853(f), the Federal Rules of Criminal Procedure
provide for no further inquiry into the property's
forfeitability until disposition of the criminal charges on
which the forfeiture is predicated. See Fed. R.
Crim. P. 32.2(b)(1)(A) (providing for final criminal
forfeiture determinations " [a]s soon as practical
after a verdict or finding of guilty, or after a plea of
guilty or nolo contendere is accepted, on any count in
an indictment or information regarding which criminal
forfeiture is sought." ) (emphasis added); see
alsoSunrise Acad. v. United States, 791
F.Supp.2d 200, 202-03 (D.D.C. 2011) (noting that upon showing
that property is forfeitable and in danger of dissipation,
" neither Section 853 nor Rule 32.2 provides for any
further inquiry into the property's forfeitability until
the defendant in an associated criminal proceeding is found
or pleads guilty" to the charge for which criminal
forfeiture is sought). At a ...