New York Prosecutor Sets Record With $8.6 Billion in Forfeitures

  • Bharara touts combined 2-year total for civil, criminal cases
  • Total includes 29,655 bitcoins seized from Silk Road website

They say crime doesn’t pay.

But busting bad guys has been lucrative for federal prosecutors in Manhattan, who collected almost $12 billion in fines and civil penalties in 2014 and 2015, with almost a third coming from BNP Paribas SA for violating U.S. economic sanctions.

The total includes more than $8.6 billion in civil and criminal forfeiture cases, the most that Manhattan U.S. Attorney Preet Bharara or any federal prosecutor’s office has ever collected in a two-year period, Bharara said Thursday.

The funds include more than $3 billion in civil actions and more than $1.3 billion in restitution, criminal fines and special assessments, according to Bharara.

Some of the biggest payouts the U.S. got were from banks. BNP Paribas forfeited $3.84 billion after France’s biggest bank pleaded guilty in 2014 to violating U.S. sanctions by transferring billions of dollars on behalf of Sudan, Iran and Cuba. The money will go to a fund established to help victims of terrorist attacks, the government said.

The government got more than $1.7 billion from JPMorgan Chase & Co. as part of a deferred prosecution agreement for violations tied to Bernard Madoff’s multibillion dollar Ponzi scheme, while in March 2015, Commerzbank AG entered into a deferred prosecution agreement and paid $300 million stemming from multiple investigations, including one by Bharara, for its role role in the accounting scandal at Olympus Corp.

The $5.24 billion collected in 2015 was twice as much as the $2.7 billion which Bharara reported collecting during a 13-month period from January 2013 to February 2014, according to records.

"These recoveries not only serve to deter bad conduct, but also a significant portion of the money recovered will go toward compensating victims of crime or other misconduct who suffered real financial loss," Bharara said.

Bharara recovered billions of dollars from automakers stemming from safety issues. Toyota Motor Corp. agreed in March 2014 to pay $1.2 billion after it entered into a deferred prosecution led by Bharara for hiding safety defects over uncontrolled acceleration, the biggest U.S. criminal penalty for a car company. Last September, General Motors Co. agreed to pay $900 million to end a criminal probe over an ignition switch flaw.

The U.S. also branched off into e-commerce, collecting more than $18.7 million stemming from a civil action Bharara filed for the assets of Silk Road, an online marketplace in which customers used bitcoins to buy illegal drugs. The U.S. obtained a judgment in which 29,655 bitcoins were forfeited and later auctioned off, Bharara said, netting more than $18.7 million. Another 144,366 bitcoins were seized by the U.S. and won’t be sold pending the conclusion of the appeal of Ross Ulbright, Silk Road’s founder who was convicted after trial.

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