Forfeiture of $493,994.54 Ordered in Bank Fraud Case

Strategic Insights -

A jury's guilty verdict in a conspiracy to commit bank and wire fraud case has led a court to order the forfeiture of $493,994.54, with the government arguing that the defendant's scheme was inherently illegal and therefore an "illegal service" rather than a lawful service provided in an illegal manner. The court's ruling hinges on the distinction between two definitions of "proceeds" in the civil forfeiture statute, with the broader definition applying to cases involving illegal goods, services, or unlawful activities. The defendant's contention that its services could be performed lawfully was rejected by the court, which found that the bank fraud at the core of its scheme was inherently unlawful.

Key Takeaways:

  • The jury found the defendant guilty of conspiracy to commit bank fraud, which is an inherently unlawful activity.
  • The court held that the defendant's scheme was an "illegal service" rather than a lawful service provided in an illegal manner, citing the broader definition of "proceeds" in the civil forfeiture statute.
  • The defendant's contention that its services could be performed lawfully was rejected by the court, which found that the bank fraud was the core of its scheme and was inherently unlawful.
  • The court ruled that the Aloisio Group's bank fraud was "inherently illegal," and its scheme was thus an "illegal service" rather than a "lawful service" that was "provided in an illegal manner."
  • The court's decision highlights the importance of distinguishing between lawful and unlawful activities in determining the applicability of the civil forfeiture statute.
  • The defendant's attempt to characterize its fraud as lawful was found to be irrelevant, as the court looked beyond the label to the underlying conduct.

Statistics:

  • $493,994.54: The amount of money ordered to be forfeited by the court.
  • 18 U.S.C 981(a)(2)(A): The section of the civil forfeiture statute that defines "proceeds" as property obtained directly or indirectly as a result of the commission of the offense giving rise to forfeiture.
  • 18 U.S.C 981(a)(2)(B): The section of the civil forfeiture statute that defines "proceeds" as the amount of money acquired through illegal transactions, less direct costs incurred in providing the goods or services.
  • 886 F.3d 31: The case law of the First Circuit Court of Appeals that discussed the distinction between the two definitions of "proceeds" in the civil forfeiture statute.
  • 2025: The year in which the court issued its decision in this case.

Sources:

  • United States v. Aloisio, et al. (Lawyers Weekly No. 52-098-25) (17 pages) (McElroy, J.) (C.A. No. 21-cr-27-MSM-PAS) (Aug. 22, 2025).