RESPONSE by USA as to Martin Kao re 149 Objection, Response to Tiffany Jennifer Lams Objection… — USA v. Kao (Dkt. 154)

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Response to Tiffany Jennifer Lam's Objection to the United States' Motion for Order Authorizing Application of Defendant's Bond Deposit to Payment of Special Assessment and Restitution (ECF No. 149), Document 154, filed 02/27/25, in the U.S. District Court for the District of Hawaii, United States of America v. Martin Kao, Crim. No. 21-00061 LEK. The United States states that the bail deposit consists of property owned by Defendant, so the Court should overrule the objection and grant the motion. It states that Lam claims an interest in approximately $1,500,000 of the $2 million cash bail and argues that the Merrill Lynch account ending in 2641 was solely in Defendant's name and that no divorce proceeding is pending. The response is dated February 27, 2025 and carries the /s/ signature of Sydney Spector.

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KENNETH M. SORENSON 
Acting United States Attorney  
 
       
District of Hawaii  
 
 
       
 
CRAIG S. NOLAN 
 
 
       
SYDNEY SPECTOR #11232  
       
Assistant U.S. Attorneys  
 
       
Room 6100, PJKK Federal Building        
300 Ala Moana Blvd. 
 
 
       
Honolulu, Hawaii  96850  
 
       
Telephone:  (808) 541-2850 
 
       
Facsimile:  (808) 541-2958 
 
       
Email: Craig.Nolan@usdoj.gov     
       
 
 Sydney.Spector@usdoj.gov 
 
Attorneys for Plaintiff 
UNITED STATES OF AMERICA 
 
 
IN THE UNITED STATES DISTRICT COURT 
 
 
FOR THE DISTRICT OF HAWAII 
 
UNITED STATES OF AMERICA, 
 
 
 
 
Plaintiff, 
 
 
v. 
 
MARTIN KAO,          
 
 
 
 
Defendant. 
 
 
 
 
 
 
 
 
 
 
 
Crim. No. 21-00061 LEK 
 
RESPONSE TO TIFFANY JENNIFER 
LAM’S OBJECTION TO THE 
UNITED STATES’ MOTION FOR 
ORDER AUTHORIZING 
APPLICATION OF DEFENDANT’S 
BOND DEPOSIT TO PAYMENT OF 
SPECIAL ASSESSMENT AND 
RESTITUTION (ECF NO. 149); 
EXHIBIT A; CERTIFICATE OF 
SERVICE 
 
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RESPONSE TO TIFFANY JENNIFER LAM’S OBJECTION TO THE 
UNITED STATES’ MOTION FOR ORDER AUTHORIZING  
APPLICATION OF DEFENDANT’S BOND DEPOSIT TO  
PAYMENT OF SPECIAL ASSESSMENT AND RESTITUTION (ECF No. 149) 
 
The United States of America, by and through its undersigned attorneys, 
hereby responds to Jennifer Tiffany Lam’s Objection to the United States’ Motion 
for Order Authorizing Application of Defendant Martin Kao’s Bond Deposit to 
Payment of Defendant’s Special Assessment and Restitution (ECF No. 149).  
Because Defendant’s bail deposit consists of property owned by Defendant, the 
Court should overrule Lam’s objection and grant the government’s motion to apply 
the deposit to criminal penalties ordered as part of the judgment in this matter. 
I. 
Factual Background 
After being arrested pursuant to warrant and complaint, on October 8, 2020, 
Defendant Martin Kao posted a $2 million secured bond, all by way of cash 
deposit.  At the time of posting the bond, Defendant filed a notarized “Affidavit of 
Cash Bail,” in which he stated that “the $2,000,000.00 cash deposited as bail on 
the foregoing bond is owned by me and is to be returned to me . . . upon 
exoneration.”  ECF Nos. 14 (sealed version), 150 (redacted unsealed version) 
(emphasis added).  The receipt issued by the Clerk’s Office reflects that the 
“Payer” is Defendant.  Id. 
On May 6, 2021, a grand jury returned an indictment charging Defendant 
with three counts of wire fraud, in violation of 18 U.S.C. § 1343, and five counts of 
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money laundering, in violation of 18 U.S.C § 1957.  (ECF No. 21.)  On September 
7, 2022, Defendant pled guilty to all counts without a plea agreement.  (ECF No. 
76.)   
On August 5, 2024, the United States filed the motion at issue, pursuant to 
28 U.S.C. § 2044, requesting that the Court order that the $2,000,000.00 cash bail 
be applied to Defendant’s criminal penalties upon Defendant’s surrender for 
service of any term of imprisonment imposed by the Court (the “Turnover 
Motion”).  (ECF No. 132.)  
On February 13, 2025, Defendant was sentenced to 87 months imprisonment 
and, in relevant part, ordered to pay restitution in the amount of $12,841,490.00 
and a special assessment of $800.00.1  On the same day, at the hearing on the 
Turnover Motion—approximately six months after the Turnover Motion was 
filed—an attorney for Defendant’s wife, Tiffany Jennifer Lam, appeared and filed 
an Objection to the Turnover Motion (the “Objection”).  (ECF No. 149.) 
In her Objection, Lam asserts that the $2 million cash bail was withdrawn on 
October 6, 2020 from a Merrill Lynch account ending in 2641 (“ML2641”), and 
that such account contained $3,000,000.00 at the time of the withdrawal.  (ECF 
No. 149 at 4-5.)  Lam claims that she has an interest in the $2,000,000.00 because 
 
1 The Court reserved determination as to whether additional restitution will be 
imposed in favor of PacMar f/k/a Navatek. 
 
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ML2641 was part of a purported “marital estate.”2  Id. at 3.  Specifically, Lam 
claims that she has an ownership interest in “approximately $1,500,000” of the $2 
million bail because ML2641 held $3 million at the time the bail money was 
withdrawn.  Id. at 7.   
A review of records relating to ML2641 reveal that ML2641 was held solely 
in the name of Defendant; it was not a joint account with Lam.  See Exhibit A at 
BOA-317-308-DOJ-0000001 (signature card for ML2641 identifying solely 
Defendant as owner); MLPFS-00202-004-DOJ-0000135 (identifying ML2641 
account as “single” ownership).  
II. 
Argument 
Pursuant to 28 U.S.C. § 2044:  
On motion of the United States attorney, the court shall 
order any money belonging to and deposited by or on 
behalf of the defendant with the court for the purposes of 
a criminal appearance bail bond (trial or appeal) to be 
held and paid over to the United States attorney to be 
applied to the payment of any assessment, fine, 
restitution, or penalty imposed upon the defendant. . . . 
This section shall not apply to any third party surety. 
 
28 U.S.C. § 2044. 
 
 
2 Lam repeatedly refers to a purported “Marital Agreement” that makes all property 
joint property, but that appears to refer merely to an alleged informal 
understanding between Lam and Kau, and not a written agreement.  See ECF No. 
149-1 ¶ J.  
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For the reasons below, Lam’s argument, that some portion (allegedly $1.5 
million of the $2 million bail money) belongs to her and is thus not subject to 
turnover, fails. 
A. 
The government has shown, by a preponderance of the evidence, 
that the $2 million belongs to Defendant.  
 
When evaluating a Section 2044 turnover motion, most courts that have 
addressed the issue have held that the government must prove, by a preponderance 
of the evidence, that the posted bond money belongs to the defendant.  See United 
States v. Hills, No. 1:16-CR-329, 2022 WL 1127888, at *3 (N.D. Ohio Apr. 15, 
2022) (collecting cases); United States v. Srithongrung, No. 4:19-CR-00752-7, 
2023 WL 2232023, at *1 (S.D. Tex. Feb. 22, 2023). 
In determining whether money belongs to a defendant, courts have found 
that a defendant’s signing of the appearance bond as the owner of the posted 
property is strong evidence of ownership.  See Hills, 2022 WL 1127888, at *4 
(“defendants’ representations under oath that they were the sole owners of the 
property offered to secure the bond is strong evidence that money deposited by 
each defendant belongs to them”); Srithongrung, 2023 WL 2232023, at *1 
(cashier’s check and affidavit are compelling evidence that money belonged to 
defendant); see also United States v. Bell, Cr. No. 20-2887, 2025 WL 319241, at 
*3-4 (S.D. Cal. Jan. 21, 2025) (ordering turnover where defendant controlled bank 
account that money was drawn from and receipt identified defendant as remitter).   
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Here, Defendant signed an affidavit attesting that “the foregoing bond is 
owned by me and is to be returned to me,” and the receipt from the Clerk’s Office 
lists the “payer” as Defendant.  (ECF Nos. 14, 150.)  Further, if as Lam claims, the 
bond was drawn from ML2641, it is significant that ML2641 was an individual 
account held solely in Defendant’s name.  Ex A at BOA-317-308-DOJ-0000001 
(signature card for ML2641 identifying solely defendant as owner); MLPFS-
00202-004-DOJ-0000135 (identifying ML2641 account as “single” ownership). 
Lam ignores the above and claims that she is entitled to “approximately $1.5 
million” of the $2 million dollar bond because ML2641 was part of a purported 
marital estate and held $3 million at the time the bond money was withdrawn.  
Lam’s self-serving affidavit is insufficient to establish that any amount of the bond 
belongs to her, in light of the single ownership of the account in Defendant’s name 
and Defendant’s affidavit.  Further, as discussed below, even if Lam were able to 
establish a marital interest in the property, there is absolutely no basis to claim that 
75% of the $2 million posted belongs to her.3 
Lam’s Objection cites to United States v. Gonzales, and other district court 
cases, but such cases show only that, under certain factual circumstances – which 
 
3 Lam’s assertion that she was the person who delivered the cashier’s check, ECF 
No. 149 at 4, is immaterial.  That only shows that the bond was posted “on behalf 
of the defendant,” when viewed in context with other evidence. Hills, 2022 WL 
1127888, at *4-5 (rejecting argument that third party that physically posted the 
bond necessarily had an ownership interest). 
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are not present here – a family member may be considered a third-party surety, and 
under such circumstances, bail money would not be available for turnover pursuant 
to 28 U.S.C. § 2044.  However, all cases cited by Lam are inapposite.  See 
Gonzales, Cr. No. 11-80211, 2013 WL 654918 (S.D. Fla. Feb. 21, 2023) (where 
bond co-signed by objecting third-party and others, government could not show 
that defendant owned the funds by merely relying on the fact that the defendant 
earned a substantial income from fraud scheme); United States v. Arnold, Cr. No. 
18-30, 2020 WL 957415 (N.D. Miss. Feb. 27, 2020) (wife was third party surety 
where deposit receipt listed wife as the “Payer” and no evidence that money 
belonged to defendant); United States v. Equere, 916 F. Supp. 450 (E.D. Pa. 1996) 
(government agreed that bail money belonged to defendant’s brother); United 
States v. Sparger, 79 F.Supp.2d 714 (W.D. Tex. 1999) (attorney was third party 
surety when he used his own money to post bond); United States v. Salyer, Cr. No. 
10-61, 2014 WL 412088 (E.D. Cal. Feb. 3, 2014) (undisputed that sister’s trust was 
the source of the bail money and that those funds were deposited with the 
understanding that they would be returned to the trust upon exoneration of the 
bond). 
In light of Defendant’s affidavit attesting to ownership of the $2 million cash 
bail posted and that the money should be returned to him upon exoneration of the 
bond, and the fact that the money was withdrawn from an account owned solely by 
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Defendant, the government has established by a preponderance of the evidence that 
the money “belongs” to Defendant.  Therefore, Lam’s objection should be 
overruled in its entirety. 
B. 
Lam cannot establish a marital interest in the $2 million. 
 
Without explicitly acknowledging the account from which the bail money 
was withdrawn (ML2641) was not jointly held, Lam—who is still married to 
Defendant—relies on cases relating to divorces to claim that (1) she should be 
entitled to 50% of the account balance of ML2641 ($3 million) at the time the $2 
million bail money was withdrawn because ML2641 was part of a purported 
marital estate, and (2) that this Court should find that her alleged $1.5 million 
interest (50% of $3 million) should attach to the $2 million bond posted, and not 
the remaining $1 million in the account that the parties supposedly subsequently 
spent on attorneys’ fees.  (ECF No. 149 at 7.) 
State divorce law principles have no application here.  In United States v. 
Real Prop. Located at 148 Maunalanikai Place in Honolulu, Hawaii, a civil 
forfeiture action, the court analyzed whether a spouse has a vested marital interest 
in property held solely in the name of their spouse.  United States v. Real Prop. 
Located at 148 Maunalanikai Place in Honolulu, Hawaii, No. CIV. 07-00049 HG 
LEK, 2008 WL 3166799, at *7-8 (D. Haw. Aug. 6, 2008).  Upon its review of 
Hawaii divorce law, the court held that a “marital estate” can be determined only at 
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the time of the conclusion of the evidentiary portion of a divorce trial.  Id. (citing 
Malek v. Malek v. Malek, 8 Haw.App. 377, 380 (1989) and Haw. Rev. Sat. § 580-
47, the statute governing division of property in a divorce).  Further, the court 
determined that divorce law principles governing property distribution apply only 
in the event of divorce.  Id.  
Here, no divorce proceeding is pending.  Lam cannot rely on divorce law to 
determine that she has a vested interest in money withdrawn from a bank account 
held solely in Defendant’s name, and then posted with an affidavit attesting that 
Defendant is the owner and that the property should be returned to him.4  See Real 
Prop. Located at 148 Maunalanikai Place in Honolulu, Hawaii, 2008 WL 
3166799, at *8 (under Hawaii law, and law of many other states, equitable 
distribution of marital property in a divorce does not confer ownership interest 
independent of the divorce); In re Radinick, 419 B.R. 291, 294 (Bankr. W.D. Pa. 
2009) (marital interest vests only upon judgement of divorce under New York and 
New Jersey law); United States v. Abell, 985 F.3d 111, 114 (1st Cir. 2021) (under 
 
4 Even if the account were jointly held, under Hawaii law, a debtor presumptively 
holds the entire joint bank account.  Traders Travel Int'l, Inc. v. Howser, 69 Haw. 
609, 615 (1988) (distinguishing a joint account from property held as tenancy-by-
the-entirety and rejecting debtor’s wife assertion that her interest in joint account 
could not be garnished); Haw. Rev. Stat. § 412:4-105.  Further, here, the money 
being sought no longer resides in a bank account; it was withdrawn from the 
account and deposited by Defendant with the Court, along with a verification that 
the money belonged to him. 
 
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Massachusetts law, defendant’s wife did not have vested property interest in 
account defendant held individually, so she lacked standing to challenge 
garnishment order against defendant’s account to pay restitution obligation). 
Even if this Court were to find that Lam has an interest in the $2 million 
bond – which it cannot – Lam’s assertion that she is entitled to 75% of the bond 
money is meritless.  Although it is possible that, in a divorce proceeding, a court 
could evaluate various equitable factors and determine that Lam has an interest in 
an account held solely in Defendant’s name, no basis exists to believe that such an 
award would be a 50% interest. 5  See Balogh v. Balogh, 134 Haw. 29, 40 (2014) 
(no fixed percentage for determining division of marital assets).  Lam has not 
presented any evidence for this Court to find such an interest, and it would be 
wholly inappropriate for this Court to engage in such speculative analysis given 
that no divorce proceeding exists to give rise to a “marital estate” that can be 
distributed.6  
 
5 Even under Lam’s fiction, her math does not add up.  If, as Lam asserts, the $3 
million in the account immediately before withdrawal of the $2 million bail was 
jointly owned, then each spouse owned $1.5 million, and therefore $1.5 million of 
the $2 million bail was owned by Defendant.  Alternatively, if Lam’s fiction 
involves a continuing 50% interest in property held by the Kao, then she owned 
only $1 million of the $2 million bail. 
6 Furthermore, any such analysis would require consideration of all property owned 
by Defendant and/or Lam to ascertain the entirety of the purported “marital estate,” 
not merely the contents of one account, and to determine whether Defendant had 
dipped into Lam’s purported 50% of the “martial estate.” 
 
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III. 
Conclusion 
Based on the foregoing, the government respectfully requests that the Court 
enter an order authorizing the Clerk of Court to apply the $2,000,000 cash bond 
previously posted by Defendant and presently held by the Clerk of Court to 
payment of Defendant’s criminal penalties. 
DATED:  February 27, 2025, at Honolulu, Hawaii. 
 
 
 
 
 
 
 
KENNETH M. SORENSON 
 
 
 
 
 
 
 
Acting United States Attorney 
 
 
 
 
 
 
 
District of Hawaii 
 
      /s/ Sydney Spector 
By ____________________________ 
    
     CRAIG S. NOLAN 
SYDNEY SPECTOR 
Assistant U.S. Attorneys 
 
 
 
 
 
 
 
 
Attorneys for Plaintiff 
 
 
 
 
 
 
 
UNITED STATES OF AMERICA
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CERTIFICATE OF SERVICE 
I hereby certify that, on the date noted below, a true and correct copy of the 
foregoing was served on counsel of record using the Court’s CM/ECF electronic 
filing system. 
DATED:  February 27, 2025, at Honolulu, Hawaii. 
 
 
/s/ Sydney Spector  
 
 
 
 
 
 
 
 
 
U.S. Attorney’s Office 
 
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