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Appeals court to 'Joey Checks': Pay U.S. $12M

A federal appeals court has reinstated a $12-million forfeiture order against convicted money launderer Joseph "Joey Checks" Castello.

The order by the U.S. Court of Appeals for the Second Circuit in Manhattan came Wednesday.

It requires Castello, 46, who remains imprisoned at the U.S. Penitentiary at Lewisburg, Pa., to pay the federal government an amount fixed at $12,012,924.31 "plus his equity in certain real property."

Castello was convicted in 2007 in a scheme that fueled an illegal, underground economy on Long Island and in the metropolitan area by cashing $660 million in checks for businesses. He was sentenced to the maximum 5 years in prison. His release date is Nov. 29, 2011, federal court records show.

During the trial, prosecutors said Castello worked out of his car, his trunk filled with bags of money, driving around and cashing checks for businessmen who wanted unreported cash.

According to prosecutors, Castello charged a fee of 3 to 5 percent to cash the checks, and recouped most of the money by cashing them at check-cashing services.

Castello, of Greenwich, Conn., was convicted on one count of failure to report cash transactions. He then appealed a court forfeiture order, and after a series of reversals the order was upheld in the Manhattan court's decision "to reinstate the initial forfeiture order."

The $12 million included $9.3 million in Castello's profit from the check-cashing enterprise, as well as income taxes, interest and penalties from 1999 to 2007.

The original forfeiture order was made in federal court in Central Islip by U.S. District Judge Leonard Wexler. Castello appealed on the basis of the Eighth Amendment's ban on excessive fines. The federal Second Circuit sent the case back to Wexler to reconsider, which he did and reversed himself, saying no forfeiture was required. The government then took the case to the Court of Appeals, resulting in Wednesday's decision.

Castello's attorney, Murray Singer of Great Neck, could not be reached for comment Thursday.

With staffer Robert E. Kessler

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