United States of America v. Approximately $1,116,331.67 seized from Bank of America Charitable Gift Fund et al
OPINION AND ORDER granting 20 Motion for Default Judgment of Forfeiture. Judgment of default is entered against defendants, all rights in the funds are forfeited to the United States, and clear title to the funds is vested in the United States. The Clerk shall enter a default judgment as set forth in the Opinion and Order, terminate all deadlines, and close the file. Signed by Judge John E. Steele on 11/29/2017. (RKR)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
UNITED STATES OF AMERICA,
SEIZED FROM BANK OF AMERICA
account number 80-16-2002766129 and APPROXIMATELY
MORGAN STANLEY GLOBAL IMPACT
OPINION AND ORDER
This matter comes before the Court on the government's Motion
for Default Judgment of Forfeiture (Doc. #20) filed on October 30,
No appearances have been made, and the time to respond has
The Court finds that an evidentiary hearing is not
required in this case.
1. Procedural History
On June 29, 2017, the United States filed a Verified Complaint
for Forfeiture In Rem (Doc. #1) to forfeit the following property,
$1,116,331.67 seized from Bank of America Charitable Gift Fund
account number 80-16-200-2766129 designated by Andre and Paula
Bernard; and (2) Approximately $507,840.86 seized from Morgan
Stanley Global Impact Funding Trust account number 186764 held by
the Bernard Family Charitable Fund and controlled by Andre and
An Order Directing Issuance of a Warrant of Arrest
In Rem (Doc. #6) was issued, the warrants were executed by the
United States Marshal.
The defendant funds were
seized, and are currently being maintained in a Treasury Suspense
(Doc. #1, ¶ 7.)
A Declaration of Publication (Doc. #12)
was also filed indicating that notice was posted on an official
government internet site for at least 30 consecutive days.
claimants made an appearance, and the United States moved for the
entry of a default.
The request was granted, and a Clerk’s Entry
of Default (Doc. #19) was issued as to the defendant funds on
October 12, 2017.
The motion for default judgment followed, and
the United States has complied with the prerequisite of obtaining
2. Criminal Case
The defendant funds were seized as proceeds stemming from
criminal fraud conspiracy and false statement charges in the
underlying criminal case against Andre Bernard (Bernard), Case No.
Bernard’s co-conspirators were indicted
separately in various cases.
On June 12, 2017, the Acting United
States Attorney charged Bernard with conspiracy to commit wire
fraud in violation of 18 U.S.C. §§ 1343 and 1349 (Count One), and
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making false material statements in records and reports required
to be filed under the Clean Air Act in violation of 42 U.S.C. §
7413(c)(2)(A) and 18 U.S.C. § 2.
The Information contains a
forfeiture provision for the defendant funds.
Information pursuant to a Plea Agreement that was accepted by the
restitution in the amount of no less than $4,360,724.50 to the
United States Department of Treasury, jointly and severally with
co-conspirators, and an additional $15,350,953 for false biodiesel
mixture fuel tax credits claimed and received by unindicted coconspirators.
As part of the Plea Agreement, Bernard also agreed
to forfeit the defendant funds specifically at issue in this case.
Bernard is otherwise awaiting sentencing.
3. Applicable Law
When a defendant defaults, they are “deemed to admit the
conclusions of law or facts not well-pleaded.
Surtain v. Hamlin
Terrace Foundation, 789 F.3d 1239, 1245 (11th Cir. 2015).
warrant a default judgment, the facts alleged in the pleadings
Nishimatsu Const. Co., Ltd. V. Houston Nat’l Bank, 515 F.2d 1200,
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“necessary to survive a motion to dismiss for failure to state a
4. Factual Basis
The defendant funds were seized from two accounts opened with
fraud proceeds by Andre Bernard and Paula Bernard.
signed Consents to Forfeiture (Doc. #1-6, Exh. 1) consenting to
the civil, criminal, or administrative forfeiture of the defendant
The well-pled allegations set forth in the Complaint are
On June 24, 2016, Thomas Davanzo and Robert Fedyna
pleaded guilty to one count of Conspiracy to Commit Wire Fraud and
one count of Money Laundering Conspiracy in Case Number 2:15-cr141-FTM-99MRM for a scheme that took place from approximately April
2013 to May 2014.
The parties agreed for purposes of sentencing
that the loss amount was approximately $46 million in proceeds.
These proceeds were deposited into and laundered through several
In 2015, several other co-conspirators were
indicted and pleaded guilty in the Eastern District of Washington
in two separate cases.
Co-conspirators Scott Johnson, Richard
Estes, and wife Nancy Bush-Estes indicated that it was Bernard
that orchestrated the fraud scheme and directed how the proceeds
would be distributed among the co-conspirators.
Bank of America Charitable Gift Fund
On or about December 27, 2013, the Bernards submitted a joint
application to the Bank of America Charitable Gift Fund, a donor-
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advised fund that offers an account from which a donor can organize
The application provided that funds would be
coming from “personal savings.”
The Paula and Andre Bernard
Charitable Trust was actually funded by two deposits on December
24, 2013, totalling $1,050,000.00, with one part coming from the
account of Eco Waste Repurposing, LLC (Eco Waste) and the other
amount coming from the account of B Green Group, LLC (B Green).
Andre Bernard was the signor on the Eco Waste account opened on or
about December 9, 2013.
Andre Bernard was also listed as the
Managing Member of B Green, which opened a JP Morgan Chase account
Both accounts started with zero balances before the
various wire transfers began.
Three wire transfers were made from a company associated with
co-conspirators to the Eco Waste account before the December 24,
2013 transfers to the Charitable Trust.
The primary purpose of
the Eco Waste account appears to have been to act as a layering
account to obscure the link between fraud proceeds and funds
deposited into the Charitable Trust.
There were also numerous
transfers from co-conspirator companies to the JP Morgan account
for B Green as well.
The Charitable Trust was funded with the
companies associated with Bernard.
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Morgan Stanley Global Impact Funding Trust
The Bernard Family Charitable Fund was established on or about
December 31, 2011, by Andre and Paula Bernard at Morgan Stanley,
and both are signors on the account.
This Morgan Stanley Fund was
funded by $1,200,000.00 withdrawn from the account of National Oil
Recovery, LLC (National Oil), which in turn was funded by transfers
from the accounts of co-conspirator.
Bernard as the Managing Member.
National Oil lists Andre
National Oil opened a TD Bank
account on August 29, 2013, with Andre and Paula Bernard as signors
on the account.
The TD Bank account was essentially a pass through
account to layer transfers and obscure the source of funds going
to the Morgan Stanley Fund.
The Complaint is verified and signed by Special Agent Cameron
Lalli with the Criminal Investigation Division of the Internal
5. Legal Basis
The Complaint was filed in accordance with Rule G(2) of the
Supplemental Rules for Admiralty or Maritime Claims and Asset
Forfeiture Actions, and subject matter jurisdiction is premised on
28 U.S.C. § 1345 because the United States initiated the case, and
§ 1355 because it provides original and exclusive jurisdiction
requirements of Rule G(2), the government also complied with the
requirements for process by warrant and notice under Rule G(3) and
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The Court further finds that the allegations sufficiently
support judgment in favor of the United States, and both signors
on the accounts (the Bernards) have consented to the forfeiture.
Having accepted the well-pled allegations in the Complaint,
and having taken judicial notice of the underlying criminal docket
for Andre Bernard, the Court finds that the motion is due to be
Accordingly, it is hereby
ORDERED AND ADJUDGED:
1. The Government's Motion for Default Judgment of Forfeiture
(Doc. #20) is GRANTED.
2. Pursuant to Federal Rule of Civil Procedure 55(b)(2) and
entered against Bank of America, Morgan Stanley Global
Impact Funding Trust, the Defendant Funds.
claims or statements of interest are time-barred.
3. All rights, title, and interests in the Defendant Funds
are hereby forfeited to the United States of America,
Procedure 55(b)(2), and Local Rule 7.03(i)(1), and clear
title to the Defendant Funds is vested in the United States
of America for disposition in accordance with law.
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4. The Clerk shall enter a default judgment accordingly,
terminate all deadlines and close the file.
DONE and ORDERED at Fort Myers, Florida, this
of November, 2017.
Counsel of Record
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