In white-collar criminal cases, forfeiture is one of the most consequential sentencing components, yet it remains overlooked and misunderstood by practitioners. The U.S. Court of Appeals, Second Circuit’s recent decision in United States v. Ng Chong Hwa demonstrates why a thorough understanding of forfeiture is essential.
The case comes wrapped in a fact pattern almost made for headlines: a sprawling international bribery scheme, bankers helping underwrite massive 1MDB bond offerings, and a multibillion-dollar loss to Malaysia’s sovereign fund. But beyond the intrigue, Ng offers clear insight into the modern landscape of criminal forfeiture. The opinion underscores just how steep the climb is for defendants raising Eighth Amendment challenges and highlights the practical lessons white-collar attorneys should keep in mind when contesting forfeiture in federal court.
The Law and Limits of Criminal Forfeiture
Criminal forfeiture is a sentencing tool that allows the government to confiscate property derived from, or used to facilitate, criminal activity. See Honeycutt v. United States, 581 U.S. 443, 447 (2017). Its goals are straightforward: strip offenders of their “ill-gotten gains,” make victims whole, and weaken criminal enterprises. Id. (quoting Caplin & Drysdale, Chartered v. United States, 491 U.S. 617, 629-630 (1989)). Procedurally, criminal forfeiture follows a predictable framework. After a guilty verdict, the court determines whether the government has shown, by a preponderance of the evidence, a sufficient nexus between the property and the offense. This includes both property “involved in” the offense and property “traceable to” criminal proceeds. The court then issues a preliminary order, followed by a final order after resolving any third-party claims. See Fed. R. Crim. P. 32.2.
For years, forfeiture orders avoided the constitutional limelight, as they were not viewed as “fines” subject to analysis under the Eighth Amendment’s Excessive Fines Clause. However, in Austin v. United States—and later, United States v. Bajakajian—the U.S. Supreme Court explicitly held that criminal forfeiture was a punishment, and therefore subject to constitutional scrutiny. 509 U.S. 602, 602 (1993); 524 U.S. 321, 328 (1998).
In Bajakajian, the U.S. Supreme Court, for the first time, struck down a forfeiture as unconstitutional under the Excessive Fines Clause. 524 U.S. at 321. There, the defendant had attempted to leave the United States without reporting that he was transporting more than $10,000, in violation of a statute. Id. The government sought forfeiture of the full $357,144 he carried, arguing that the entire amount was “involved in” the offense. The Court disagreed, holding that forfeiting the full sum was grossly disproportional to the gravity of the offense. Id.
In doing so, the Court articulated a proportionality test, asking whether a forfeiture is grossly disproportional to the underlying crime. Id. at 333-34. To guide that inquiry, the Court identified four considerations: (1) the essence of the crime of the defendant and its relation to other criminal activity, (2) whether the defendant fits into the class of persons for whom the statute was principally designed, (3) the maximum sentence and fine that could have been imposed, and (4) the nature of the harm caused by defendant’s conduct. Id. Courts have treated these factors as flexible rather than exhaustive. The U.S. Court of Appeals, Second Circuit, for example, has recognized that district courts may also consider whether a forfeiture would meaningfully affect a defendant’s future livelihood. See United States v. Viloski, 814 F.3d 104, 113 (2d Cir. 2016), cert. denied, 580 U.S. 1171 (2017).
Even though Bajakajian hints at a substantial constitutional hurdle, in practice, courts clear this obstacle with ease. Circuit courts nearly always uphold forfeitures—especially forfeitures of proceeds—as proportional. The U.S. Court of Appeals, Fourth Circuit, has stated bluntly that it may be “very difficult, and perhaps impossible,” for a defendant to show forfeiting proceeds is grossly disproportionate. United States v. Jalaram, Inc., 599 F.3d 347, 354 (4th Cir. 2010). This is for several reasons. First, courts have held that the burden “rests on the defendant to show the unconstitutionality of the forfeiture.” Viloski, 814 F.3d at 109. Second, some courts sidestep the Eighth Amendment analysis entirely through creation of conclusory rules; for example, that a forfeiture is proportional in instances where the award is “tied to the losses suffered by victims of the defendant’s crime.” United States v. Arledge, 553 F.3d 881, 889 (5th Cir. 2008). Third, several circuits expressly refuse to consider personal financial impact. The U.S. Court of Appeals, Eleventh Circuit, rejected an Eighth Amendment challenge even when forfeiture of a medical license threatened the defendant’s livelihood, noting that “the Eighth Amendment analysis does not account for the personal impact on the defendant.” United States v. Dicter, 198 F.3d 1284, 1292 n.11 (11th Cir. 1999).
Collectively, these decisions reflect a strong judicial consensus: once a defendant’s property is sufficiently “connected” to the offense, courts rarely find forfeiture excessive under the Eighth Amendment.
The Second Circuit Doubles Down on Broad Forfeiture
The U.S. Court of Appeals, Second Circuit’s recent decision in United States v. Ng Chong Hwa continues this trend. Case No. 23-6333 (2d Cir. December 5, 2025). In Ng, the defendant challenged a $35.1 million forfeiture order, the amount he personally received from a years-long bribery and money-laundering conspiracy tied to the 1MDB scandal. Id. at 11. He argued that the forfeiture was unconstitutional because Malaysia had already seized equivalent assets and because the U.S. forfeiture would destroy his future ability to earn a livelihood. Id. at 42.
The Second Circuit was unmoved. Echoing the lower court’s analysis, the court held the forfeiture proportional to the offense: Ng had engaged in a multi-year financial scheme, the forfeiture amount fell well within the range of fines authorized for the conduct, and the conspiracy contributed to enormous harm, including the theft of $3 billion. Id. at 46. As for his “livelihood” argument, the court noted that “Ng has based his argument entirely on his present personal circumstances and has not shown that he will be unable to earn money in the future.” Id. The court also emphasized that Ng did not engage with the Bajakajian proportionality framework—he compared himself to co-conspirators rather than comparing the forfeiture to the gravity of his own offense. Id. at 47. That misstep proved fatal, and the Second Circuit affirmed.
Ng illustrates that the Second Circuit remains firmly aligned with other courts in applying the Excessive Fines Clause narrowly. When a forfeiture equals the defendant’s proceeds—and the underlying conduct involves significant fraud, corruption, or public harm—courts will almost always uphold it. Ng reinforces that trend and makes clear that defendants face an uphill battle in challenging forfeiture orders on Eighth Amendment grounds.
Practical Strategies for Navigating Criminal Forfeiture
Given how rarely courts strike down forfeiture orders on constitutional grounds, defense counsel should focus first on undermining the factual predicate for forfeiture: challenging whether the government has actually shown that the targeted property was “involved in” or “traceable to” the charged offense, and pressing on breaks in the causal chain when the connection between the property and the crime is tenuous.
When an Eighth Amendment proportionality issue arises, Ng offers three sharp lessons for practitioners on either side of a forfeiture dispute. First, anchor the challenge squarely in the Bajakajian proportionality framework: compare the requested forfeiture to the gravity of the offense, not to co-conspirators or relative blame. Second, pay close attention to circuit-specific nuances in how courts apply the Bajakajian factors and the weight they assign to each. Third, in circuits that allow consideration of whether the forfeiture would impair a defendant’s future livelihood, build a robust factual record to support or rebut such arguments. This may include expert testimony on post-conviction employability, economic analyses of future earning limitations, evidence of dependents or other financial obligations, and documentation showing the relationship between forfeiture demand and actual gain. Without such a record—as Ng illustrates—livelihood-based arguments are unlikely to gain traction.