The world has been abuzz with opinions and theories about whether we may be entering a paradigm shift when it comes to global collaboration for asset recovery. This after British Prime Minister David Cameron announced a few weeks ago, while meeting with other world leaders at the Anti-Corruption Summit in London, plans for a first-ever Global Forum for Asset Recovery.
Step in the Right Direction?
At first blush, this step to gather all involved in asset recovery – governments, law enforcement agencies, financial institutions and regulators – to share and analyse information about illicit financial transactions, seems to be one in the right direction. But, we’ve witnessed first-hand the limitations that governments and government authorities have when it comes to successful asset recovery.
Governments’ Limited Reach
The government, courts, prosecutors and different security structures have a range of mechanisms and instruments in their respective jurisdictions to temporarily freeze and/or permanently take away property or funds acquired through criminal activity. However, the speed and efficiency of these mechanisms and means is territorially limited. Sure, they are usually effective in their jurisdictions, but even national jurisdictions lack competence and expertise, when dealing with complex transactions, accounts, company structures and the persons whose assets are tracked.
When performing temporary and permanent freezing of property or assets, the government mainly performs the imperative functions –freezing and appropriating the assets – and then shifts the burden of proof to the person or company, forcing them to prove that the particular asset was acquired legally. In cases with cross border elements, efficiency and especially speed of law enforcements agencies and prosecutors, as a principle, is largely absent.
Furthermore, governments are not usually willing or prepared to connect and cooperate with private professionals who know exactly what they should do. Often, these governments have the opinion that the professionals have lucrative intentions, i.e. enrichment at the expense of victims. They may also fear information leaking from investigative and criminal proceedings, so they are not willing to use such information and evidence or share them with professionals. Even if they do, they do it only partially and very selectively.
Turning to Private-Sector Professionals
However, there are examples, which are most often associated with changes in regimes or through international organizations and interventions, when private-sector professionals are engaged to pursue asset recovery. New governments usually do not trust the asset-tracing practices and safety systems of previous governments, because they are afraid that instead of asset recovery, the assets or traces of them would be hidden. They may also fear that when international organizations are involved, the assets will again be hidden and corruption will take place.
The above examples point to criminal asset recovery only. When it comes to civil asset recovery, governments generally just do not deal with it, letting victims to care for their interests themselves.
So, while talk of this global collaboration seems encouraging, we’re not yet convinced anything will change unless governments are constantly educated and informed about how the help of professionals, who know what to do, is necessary and should be a primary goal.