Securities and Exchange Commission v. Amerindo Investment Advisors Inc.

Background

The court had entered a Second Preliminary Order of Forfeiture as to Substitute Assets on December 9, 2019. The order concerned substitute property described as Vilar and Tanaka’s interests in a J.P. Morgan Chase brokerage account. On December 13, 2019, the court denied Vivian Shevitz’s request to appoint counsel for Tanaka in connection with forfeiture and denied motions to vacate the forfeiture order. Shevitz then sought reconsideration.

Appointment of Counsel

The court denied reconsideration of the appointment-of-counsel ruling. It reiterated that Shevitz could not make the request because she did not represent Tanaka in this matter. The court also noted that it had previously declined a similar request based on authority indicating that a defendant has no right to counsel for these matters and because Tanaka’s prior counsel had declined to represent him in enforcing forfeiture orders. The court concluded that Shevitz had cited no persuasive authority or identified any overlooked facts or information warranting reconsideration.

Forfeiture Order

The court also denied reconsideration of the denial of the motion to vacate the Second Preliminary Order of Forfeiture. Under the criminal forfeiture statute cited by the court, substitute property may be forfeited, up to the value of the property at issue, when forfeitable property cannot be located or has been transferred, placed beyond the court’s jurisdiction, or commingled. The court explained that the preliminary order did not state that the entire brokerage account was forfeited; it covered the defendants’ interests subject to a limitation based on the amounts in the money judgments.

The court further held that the extent of the defendants’ interests in the additional assets was for an ancillary proceeding. It stated that a third party’s interest in forfeited property must be asserted through that proceeding rather than through a direct challenge to the preliminary forfeiture order. In addition, because Vilar had filed a notice of appeal from the same order, the district court lacked jurisdiction to vacate it. The court stated that jurisdiction would not return until the court of appeals issued its mandate.

Disposition

Judge Richard J. Sullivan denied Shevitz’s motion for reconsideration concerning appointment of counsel. He also denied her motion to reconsider the December 13, 2019 denial of vacatur of the Second Preliminary Order of Forfeiture. The order was signed by Judge Sullivan, a circuit judge sitting by designation.