United States v. Annabi
746 F.3d 83
2d Cir.2014Background
- Sandy Annabi was convicted on three counts of mortgage fraud (Counts 7–9) under 18 U.S.C. § 1014; the government sought forfeiture of loan proceeds tied to those loans.
- The Superseding Indictment sought civil forfeiture under 18 U.S.C. § 981(a)(1)(C) (and 28 U.S.C. § 2461(c)) as to all three counts, and criminal forfeiture under 18 U.S.C. § 982(a)(2)(A) only as to Counts Eight and Nine.
- Section 981(a)(1)(C) (civil forfeiture) permits deduction for any portion of a fraudulent loan repaid without loss to the victim; § 982(a)(2)(A) (criminal forfeiture) requires forfeiture of the full loan amount (no offset for repayments).
- At sentencing the district court ordered forfeiture of the full loan amounts for Counts Seven ($480,700), Eight ($522,500), and Nine ($57,600) but did not specify which statutory provision it was applying to each count.
- Annabi appealed, arguing forfeiture was excessive because the Patton Drive loan (Count Seven) and Rumsey Road loan (Count Nine) had been repaid in full (no bank loss) and the Bacon Place loss was much smaller than the gross loan.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether forfeiture on Count Seven may be based on § 982(a)(2)(A) when the indictment invoked only § 981(a)(1)(C) for that count | Government: § 982(a)(2)(A) applies and permits forfeiture of full loan amount | Annabi: Court must limit forfeiture to statute charged in indictment (civil forfeiture), which allows offsets for repayments | The court held the government erred; forfeiture for Count Seven limited to § 981(a)(1)(C) as charged; criminal forfeiture under § 982 could not be applied without notice |
| Whether forfeiture under § 982(a)(2)(A) (criminal forfeiture) is properly applied to Counts Eight and Nine | Government: criminal forfeiture authorizes full-loan forfeiture for counts where it was charged | Annabi: seeks offsets for repaid loan portions | The court affirmed forfeiture for Counts Eight and Nine under § 982(a)(2)(A); gross loan amount is the correct measure |
| Whether failure to cite a harsher forfeiture statute in the indictment is harmless error | Government: prior cases (e.g., Silvious) sometimes treat such errors as harmless when notice suffices | Annabi: lack of statutory notice before sentencing prevented meaningful defense | The court found Silvious distinguishable and held lack of notice here was not harmless; cannot broaden forfeiture beyond charged statute |
| Standard of review for forfeiture determinations on appeal | — | — | Legal questions reviewed de novo; factual findings for clear error (Treacy) |
Key Cases Cited
- United States v. Peters, 732 F.3d 93 (2d Cir. 2013) (criminal forfeiture measures gross receipts; is punitive and separate from restitution)
- United States v. Treacy, 639 F.3d 32 (2d Cir. 2011) (standard of review: legal conclusions de novo; factual findings clear error)
- United States v. Newman, 659 F.3d 1235 (9th Cir. 2011) (for criminal forfeiture, ‘‘proceeds’’ of a fraudulently obtained loan equal the loan amount)
- United States v. Silvious, 512 F.3d 364 (7th Cir. 2008) (discussed distinction where substituted forfeiture statute did not broaden forfeiture and defendant had notice)