An extract from The Asset Tracing and Recovery Review, 8th Edition
Seizure and evidence
It should be noted that asset tracing is neither a claim nor a remedy. However, it is a tool to identify assets, collect evidence and subsequently be able to assess possible legal measures and their chances of success. The overall goal is the recovery of deprived assets and consequently the denial of these assets to the persons who obtained them through fraudulent acts.i Securing assets and proceedsPreliminary injunctions (civil proceedings)
To secure monetary claims, one can request the issuance of a preliminary injunction at the civil courts. This can either take place in the course of pending civil proceedings in the respective matter or before filing a claim. The subjective endangerment must be successfully argued. If the damaged party already holds an enforceable decision, a request to secure these monetary claims can be filed without proving the subjective endangerment.
Following the Austrian courts, a subjective endangerment is established in cases where it is obvious that without a preliminary injunction the damaging party will damage, destroy, hide or move away assets in order to hinder the claimant from pursuing its claim. In general, the latest behaviour of the defendant, as well as the specific circumstances of the case, are decisive.
The court can order the following preliminary measures with respect to the object at stake:
- movable assets and money: judicial custody and administration; judicial prohibition of sale or pledging; judicial order to refrain third parties from moving assets;
- immovable assets: judicial custody and administration; judicial prohibition of sale or pledging; judicial order prohibiting any registrations in the land registry; and
- receivables: issuance of a garnishment order.
To secure potential civil claims of a private party, the public prosecutor can order the securing of assets, including monies on bank accounts by prohibiting the issuance, pledging or disposal of the assets. The public prosecutor is entitled to order an asset freeze to (1) secure evidence, (2) secure civil claims and (3) secure a proprietary order that might be issued by the court at the end of the proceedings (e.g., confiscation or forfeiture).
Following the securing of assets, the public prosecutor will file an application to the court to seize these assets, as the order of the public prosecutor shall usually only be of a provisional nature. The public prosecutor is not bound to any explicit deadline in filing such an application. Both the public prosecutor and the criminal court will lift the order to secure or seize assets when there is no more reasonable suspicion regarding the alleged criminal offences or if the prerequisites for the order ceased to exist.
In the case of a conviction, and the granting of the civil claims or parts thereof, the claim will be settled from the seized assets. In such a scenario, a forfeiture of the assets is not permissible in the amount granted to the private party. However, if the court comes to a conviction but is of the opinion that the private joinder claims are not sufficiently proven and the private party is relegated to the civil courts, the private party can apply for an interim injunction in the case of a lift of the asset freeze by the criminal court. As soon as the private party holds a decision granting its claims, the criminal court must cancel the forfeiture retroactively, and the private party is entitled to request that the civil claim shall be settled from the assets that were first forfeited. If the accused has been acquitted, the court will most likely decide that the prerequisites for a seizure ceased to exist and will order its cancellation. In that case, the private party can again apply for a subsequent interim injunction related to its civil claims.ii Obtaining evidenceInvestigators
To trace, locate and identify assets to be seized, the involvement of professional investigators is often helpful. This not only refers to private investigators gathering evidence and private experts to understand certain money flows, but also to attorneys. In Austria, lawyers have access to a range of registers (WIEREG, FB, GB, ZMR) and open source data. Lawyers who specialise in asset tracing and recovery can easily connect information and decide on the necessary measures to collect crucial evidence to build a case.Production of evidence in civil proceedings
In Austrian civil proceedings, evidence must be provided by the parties in first instance. In this regard, the parties may present documents or request the questioning of witnesses to strengthen their arguments and argue against evidence requests by the opposing party. The production of evidence is in the sole discretion of the parties. However, the court is entitled to decide if certain evidence is admissible or inadmissible (e.g., not submitted in due time, not required) and if further evidence, especially an expert opinion, is required. It should be noted that the use of unlawfully obtained evidence is not generally prohibited in civil proceedings.
If only one party is in the sole possession of decisive evidence, the court may order its disclosure. However, such orders are not enforceable by law; the refusal of disclosure may only be considered by the court in its independent assessment of evidence. As a result, criminal proceedings are often used as a tool to obtain the necessary evidence for civil proceedings.Obtaining evidence in criminal proceedings
A private party joinder or presentation of facts and circumstances is a good tool to present the victim's perspective of the case to the public prosecutor (judge), and to provide additional evidence to the state or encourage the public prosecutor to produce further evidence. Especially in complex white-collar crime matters, private parties are often in the position to assess the case in greater detail and provide the public prosecutor with the background information needed to order additional evidentiary measures. Contrary to civil proceedings, means such as house searches or confiscation of data can be ordered by the public prosecutor to obtain evidence. In cases of money laundering, the inclusion of the competent authorities should also be suggested. Against this background, a strong collaboration with the competent authorities in criminal proceedings is vital with respect to evidence production.