Monday, February 04, 2013

U.S. v. Davis, No. 11-10584 (02-1-13) (Wallace with Thomas; Berzon concurring)
The defendant has to pay for his crimes, and pay and pay.  This case involves an appeal from a forfeiture and a restitution order.  He plead to numerous counts of money laundering, one count of aiding and abetting, and one conspiracy count.  He was ordered to forfeit $1.29 million and pay $95,000 in restitution to the FBI for funds expended in the operation that led to his arrest.  On appeal, he argued that forfeiture should be offset by his restitution.  The 9th disagreed.  Forfeiture and restitution serve different purposes.  Forfeiture is punitive; restitution is restorative.  This principle, held for private banks for example who were victims, now also applies to the government.  The government spent funds to catch the defendant.  It gets the restitution back.  The forfeiture is disgorging ill-gotten profits.  Ah, the concurrence notes (Berzon joined by Thomas), the defendant here did not challenge the $1.29 million as forfeited, even though he earned a pittance of that, around $74,000. The money went through his hands to others.  Because the amount was not challenged, the issue of whether a commission paid on other people's money can lead to forfeiture by the defendant of those other fund amounts.


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