United States of America v. $50,900 in United States Currency

Filing 24

Judge F. Dennis Saylor, IV: ELECTRONIC ORDER entered. Memorandum and Order on Defendants' Motions to Dismiss. (Pezzarossi, Lisa)

UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS
___________________________________________
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UNITED STATES of AMERICA,
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Plaintiff,
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Civil Action No.
v.
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15-14125-FDS
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$50,900 IN UNITED STATES CURRENCY
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OF IBC BANK CASHIER’S CHECK
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#162263996 IN THE AMOUNT OF $250,910
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IN UNITED STATES CURRENCY, SEIZED
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ON MAY 27, 2015, FROM INSURED
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AIRCRAFT TITLE SERVICE, INC.,
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Defendant.
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___________________________________________)
MEMORANDUM AND ORDER ON
DEFENDANTS’ MOTIONS TO DISMISS
SAYLOR, J.
This is an in rem civil forfeiture action. The United States alleges that the defendant
property—“$50,900 in United States currency of IBC Bank Cashier’s Check #16226396 in the
amount of $250,910 in United States currency, seized on May 27, 2015, from Insured Aircraft
Title Service, Inc., located in Oklahoma City, Oklahoma”—was intended to be used for the
purchase of a Gulfstream II aircraft meant for use in narcotics trafficking. The government seeks
forfeiture of the property pursuant to 21 U.S.C. § 881(a)(6) and 18 U.S.C. § 981(a)(1)(A).
Pending before the Court are motions to dismiss the action filed by claimants Benjamin
Polat and Luis Saldana Grillo. Claimants contend that the complaint must be dismissed because
(1) venue is improper; (2) the government did not provide timely notice of the administrative
forfeiture process; and (3) the complaint fails to establish probable cause for the forfeiture of the
defendant currency. For the reasons stated below, the action will be transferred to the United

States District Court for the Western District of Oklahoma.
I.

Background
A.

Factual Background

The facts giving rise to this action are described in the affidavit of Drug Enforcement
Agent John Grella, attached to the complaint as Exhibit A. The bulk of Grella’s affidavit
describes an undercover investigation carried out by the DEA in Massachusetts.
Internationally-based narcotics traffickers generate large amounts of cash from their
illegal activities in the United States that must be “laundered” before it can be repatriated back to
the traffickers’ home countries. Grella Aff. ¶¶ 12-13. Narcotics traffickers typically use the
services of a third-party money broker, who in turn uses contacts in the United States to receive
drug proceeds in cash and deposit them into the United States banking system. Id. ¶ 15.
On April 8, 2015, an undercover DEA agent received a message from a Colombia-based
money broker requesting that the agent “pick up” approximately $300,000 in cash in Boston. Id.
¶ 16. The broker eventually provided the agent with the cell phone number of the money courier
and a photograph of the serial number of a one-dollar bill so that the courier and agent would be
able to verify the other’s identity. Id. On April 10, 2015, the agent met with the courier at a
grocery store in Boston and obtained a brown bag containing $398,820 in United States
currency. Id. ¶¶ 17-26.
The agent deposited the currency into a DEA undercover account in Massachusetts. On
April 29, 2015, in accordance with the broker’s instructions, the agent sent a wire transfer in the
amount of $50,045 to account number 717213717 at the International Bank of Commerce. Id.
¶ 27. Neither the complaint nor the affidavit identify the location of International Bank of

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Commerce.1 The broker identified the account holder as “Insured Aircraft Title Service” and
provided the agent with an aircraft tail number, N689JE.2 A few days later, the broker requested
that the agent retrieve the wire transfer because the money was needed in another account. The
agent did so. On May 12, 2015, the broker instructed the agent to wire the $50,045 to an account
at Bank of America in the name of “American Initiative Corporation.” Id. ¶ 28. That wire was
sent on May 13, 2015. Id. ¶ 29. The next day, the subject property account at International Bank
of Commerce received a transfer from the American Initiative Corporation, Homestead, Florida,
in the amount of $50,045. According to the affidavit, that transaction was “associated with” the
same aircraft tail number of N689JE. Id. ¶ 30.
Insured Aircraft Title Service is based in Oklahoma City. Id. ¶ 31. Insured Aircraft Title
Service received three other wire transfers for the purchase of N68JE, all of which were
deposited into the same IBC account. Id. ¶ 32. Those three transactions were (1) $8,900 from
Luis G. Saldana Grillo in Caracas, Venezuela, sent via Mercantil Commercebank in Coral
Gables, Florida; (2) $42,000 from PeeBee Corporation in Aventura, Florida, sent via Bank of
America;3 and (3) $149,965 from Krause Ventures LTD in the British Virgin Islands, sent via
Credicorp Bank in Panama City, Panama. The first two transactions (from Saldana Grillo and
PeeBee) make up the $50,900 that is the subject property in this action.
The description of the subject property indicates that it is a portion of an IBC cashier’s
check in the amount of $250,910; that it was seized on May 27, 2015; and that it is located in
Oklahoma City, Oklahoma. There is no additional information in the complaint or the Grella

1

According to publicly-available information, IBC is headquartered in Laredo, Texas, and has branches in
Texas and Oklahoma. International Bank of Commerce, http://www.ibc.com (last visited Aug. 8, 2016).
2

An aircraft “tail number” refers to the unique registration number of an aircraft, similar to the vehicle
identification number of an automobile.
3

Claimant Polat is the President of PeeBee Corp. Grella Aff. ¶ 40; Notice of Verified Claim, Dkt. 13.

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affidavit as to the circumstances of the seizure or the physical location of the property.
B.

Procedural Background

The present in rem civil forfeiture action was filed on December 11, 2015. The
government alleges that the defendant property was used or intended to be used to commit, or to
facilitate the commission of, a violation of 21 U.S.C. §§ 841 and/or 846, and seeks forfeiture
pursuant to 21 U.S.C. § 881(a)(6). On December 28, 2015, this Court issued a warrant and
monition.
Claimant Polat filed a notice of verified claim on March 11, 2016, and a motion to
dismiss the complaint on April 5, 2016. Claimant Saldana Grillo filed a notice of verified claim
and a motion to dismiss on April 19, 2016. Claimants contend that the complaint must be
dismissed because (1) venue is improper; (2) the government did not provide timely notice of the
administrative forfeiture process; and (3) the complaint fails to establish probable cause for the
forfeiture of the defendant currency.
II.

Analysis
The government contends that the court has subject-matter jurisdiction and venue under

28 U.S.C. §§ 1355(b)(1), which provides that a forfeiture action “may be brought in the district
court for the district in which any of the acts or omissions giving rise to the forfeiture occurred.”
See Contents of Account No. 03001288 v. United States, 344 F.3d 399, 403 (3d Cir. 2003)
(Section 1355 grants district courts both jurisdiction and venue over forfeiture actions).4
At a minimum, the government must plausibly allege some connection between the

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Section 1355 also grants venue in “any other district where venue for the forfeiture action or proceeding is
specifically provided for in section 1395 of this title or any other statute.” 28 U.S.C. § 1355(b)(1)(B). Section 1395
states, in relevant part, that “[a] civil proceeding for the recovery of a pecuniary fine, penalty or forfeiture may be
prosecuted in the district where it accrues or the defendant is found.” 28 U.S.C.A. § 1395(a). Although the
complaint cites to § 1395, the government argues in briefing that venue is proper under § 1355(b). Accordingly, as a
technical matter, the Court will evaluate venue under the standard listed in Section 1355(b).

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forum district and the res that is the subject of the forfeiture action. Here, the only factual
allegations in the complaint with any connection to Massachusetts involve the undercover
investigation and tracing of $50,045 in currency received by an undercover agent and ultimately
transferred to the International Bank of Commerce account in the name of Insured Aircraft Title
Service. That $50,045, however, is not the subject of this action.
The government cites United States v. Contents of Bank of Am. Account No. 9163 for the
proposition that venue is proper in the district where undercover law enforcement agents
maintained an undercover bank account used to deposit and then transfer funds suspected of
being drug proceeds. 2012 WL 1379783, at *1 (S.D. Ala. Apr. 4, 2012), report and
recommendation adopted sub nom. United States v. Contents of Bank of Am. Account No. 9163,
2012 WL 1379409 (S.D. Ala. Apr. 20, 2012). That case, however, involved the forfeiture of the
actual funds that were deposited into and transferred from an undercover account located in the
forum district.
In contrast, there are no facts alleged that the res here—the $8,900 transferred by Saldana
Grillo and the $42,000 transferred by PeeBee Corp.—has any connection at all to the undercover
account or to Massachusetts, nor are there any facts alleged connecting any acts or omissions of
claimants to this district. Accordingly, venue in the District of Massachusetts is improper.
Under 28 U.S.C. § 1406(a), “[t]he district court of a district in which is filed a case laying
venue in the wrong division or district shall dismiss, or if it be in the interest of justice, transfer
such case to any district in which it could have been brought.” It appears that the appropriate
venue is the Western District of Oklahoma, which (apparently) is the location of the subject
property, the location of Insured Aircraft Title Service, and likely the location of the IBC

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account.5 Therefore, rather than dismiss the action outright, the Court will transfer the case to
that district. 6
III.

Conclusion
For the foregoing reasons, the Court hereby ORDERS that this action be transferred to

the United States District Court for the Western District of Oklahoma.

So Ordered.

/s/ F. Dennis Saylor
F. Dennis Saylor IV
United States District Judge

Dated: August 11, 2016

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The complaint alleges that the $8,900 transfer was made through an account at Mercantil Commercebank
in Coral Gables, Florida, and that the $42,000 was sent from PeeBee Corporation, which is located in Aventura,
Florida. Both Coral Gables and Aventura located in the United States District Court for the Southern District of
Florida.
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Because venue in this district is improper, the Court need not reach the issues of timely notice and
probable cause.

6