In a landmark judgment at the High Court, it was decided that the seized cash be given to fraudster Eamonn Kelly's victims, rather than the State.
Former estate agent Kelly stole €1.6m after using Gerald Kean's name to encourage dozens of investors to participate in a 'Ponzi' scheme.
A senior source said: "CAB believes this judgment provides clarity to victims in proceeds of crime cases. The High Court action was taken on behalf of Mr Kelly's victims and not the State."
Kelly, of Decies Road, Ballyfermot, pleaded guilty at Dublin Circuit Criminal Court in January to sample charges of theft, producing a false instrument and forgery between October 2007 and February 2010.
The money that CAB seized was in three different bank accounts that had been frozen by order of the High Court.
Kelly (49) who owned two RE/MAX auctioneers franchises, told investors they could make €15,000 profit on a €50,000 investment within six months if they bought sites he claimed he had identified in the UK.
He forged Mr Kean's signature on a letter sent to potential investors to encourage them to invest in a bogus property operation in Manchester.
The letter stated that the solicitor was representing Kelly and that the estate agent acted as an adviser to Mr Kean.
Mr Kean knew nothing about the letter.
Kelly also provided potential investors with a bogus letter from the Ulster Bank in Crumlin, stating that he had €4.6m on deposit in an account there.
The scheme involved 25 groups from Dublin, Wexford and Donegal, whose investments ranged from €10,000 to €100,000. Kelly told the investors that the sites could be purchased at cut-price and hotels could then be built on them which would produce a significant short-term profit.
At Kelly's sentencing in January, it emerged that the investors represented a cross-section of society, some of whom used redundancy payments to purchase the site, others used their savings, while others were business people who would have the means to survive despite their financial loss.
Kelly had paid commission to RE/MAX agents in both Donegal and Wexford to source potential investors but gardai accept that these estate agents genuinely believed the operation was legitimate.
He found Dublin investors through his contacts with his local GAA club in Crumlin, friends and acquaintances.
The bulk of the funds, just over €1m, came from the Co Donegal investors.
The scheme came to light after the bogus letter from Ulster Bank came to the attention of the bank. They contacted the Garda, Kelly's accounts were frozen and he then presented himself voluntarily at the Garda station.
He made full admissions and said he had started the scheme after he ran into financial difficulty after the property crash.
Kelly said he was under pressure to keep up to date with his €8,000 monthly mortgage repayments on properties in Kildare, Dublin and Portugal.
Judge Martin Nolan described the offence as a classic Ponzi scheme. He said Kelly had been a decent man until he engaged in this activity and found himself totally out of his depth. Kelly's crime involved "deception, severe losses to some and breaches of trust".
He imposed consecutive sentences totalling six years.