An extract from The Asset Tracing and Recovery Review, 8th Edition
Seizure and evidence
In both civil and criminal cases, the procedure for securing assets and obtaining evidence is governed by the code of procedure of the jurisdiction where the action is brought. We will refer to the National Code of Civil and Commercial Procedure (NCCCP) and the NCCP, both applicable before federal and national courts.i Securing assets and proceeds
Under civil law, plaintiffs can resort to interim measures such as attachments and preliminary injunctions to preserve assets held by defendants and third parties, even before civil claims are brought. An interim measure request must be filed before the same judge that hears the principal claim: an order granted by an incompetent judge will still be valid if it fulfils all other legal requirements. The measures will be decided and executed ex parte. The affected party may challenge the decision, but this will not suspend its immediate enforcement. Interim measures are provisional, meaning that they can be set aside or modified after showing a change in the circumstances that justified their order.
To be admissible, plaintiffs must have a reliable claim and prove that there is a risk that the enforcement of the relief sought will be frustrated if the measure is not granted. The court will ask plaintiffs to pay court fees and offer a bond to respond for any harm caused to the defendant or any other expense. Judges will assess the reliability of the plaintiff's claim and the circumstances of the case when deciding the nature and amount of the bond. In practice, this may be the most burdensome requirement to meet, as judges will calculate the bond based on the amount of the relief sought in the main claim (it can amount to 30 to 40 per cent of the credit claimed). Moreover, all interim measures will be granted under the condition that the plaintiff initiates the main civil action within a certain period (generally 10 days).
Some of the most common interim measures to secure assets are:
- a prejudgment attachment of assets, where defendants are foreclosed from disposing of specific property, which will remain under their administration unless sequestration or administration by a third party is ordered;
- seizure of mobile assets and administration by a third party;
- a judicial intervention or administration of productive assets (such as a company);
- a general restraining order to sell or transfer property rights;
- registration of the claim with any public registry; and
- restraining notices preventing defendants from selling or transferring rights in connection with certain assets.
Additionally, apart from the remedies set forth in the law, judges are allowed to order other measures to safeguard plaintiffs' interests as they see fit (e.g., freezing of assets in bank accounts).
In criminal cases, the investigating judge may order at any stage of the investigation, ex officio or at the request of the public or private prosecutor, the attachment or seizure of any goods that can be the subject of forfeiture upon a possible conviction. If these measures are proven insufficient, the judge may issue a general restraining order to sell or transfer property rights. Additionally, judges can resort to the interim measures set forth in the codes of civil procedure; however, this option is not very commonly used.
Despite the availability of legal resources to secure assets, tracing and discovering hidden property are usually the major challenges in asset recovery efforts. Overall, court orders requesting information from relevant entities, such as public registries and financial institutions, must follow formal proceedings that hinder any chance of obtaining rapid results. Furthermore, since public registries are held by provinces, requests must be addressed to each of them separately.
Consequently, the General Prosecutor's Office started taking concrete steps to tackle these problems. Since 2009, all public prosecutors acting in national and federal courts are instructed to conduct a patrimonial investigation of individuals suspected of participating in, among other things, money laundering, corruption and some white-collar crimes. To ensure the recovery, they were also instructed to request the seizure of assets as soon as the requirements for such measure are met. In this line, a special unit for asset recovery was created within the General Prosecutor's Office in 2015.ii Obtaining evidence
There is no specific action available under Argentine law to obtain evidence in cases of fraud. Thus, plaintiffs must rely on generic means to obtain information to support their claim. As a general principle of evidence, in civil claims each party has the burden of proof regarding the facts on which they base their claim or defence.
As in most civil law jurisdictions, the concept of document discovery is alien to the Argentine civil procedure. Courts have the power to order the defendant and third parties to submit material documentation in their possession, and parties may ask the court to issue such orders on their behalf. If granted, the party that requested the order will be responsible for the necessary arrangements and notifications that the request entails.
Evidence must be submitted by means expressly provided by law (documentary evidence, expert witnesses, witness testimonies, reports), but the court may request other measures ex officio or at a party's request.
In criminal cases, as explained above, evidence rules depend on the kind of procedure (adversarial versus inquisitorial) and the specific regulations set forth in each jurisdiction's code of procedure. Overall, victims acting as private prosecutors are entitled to offer and control evidence collected during an investigation and can resort to the investigating judge or public prosecutor to obtain evidence on their behalf. Civil parties' rights, on the other hand, are restricted to these investigative measures that are needed to uphold their claim.
If a fraud is investigated by national and federal courts, the criminal investigation dossier will contain all the information relevant to the criminal investigation and the criminal charges against the defendant. The NCPC recognises victims' right to offer and control evidence. It prescribes that the dossier is public to the parties, which includes the private prosecutor but not a civil petitioner. Despite this general principle, in practice, judges may be reluctant to grant private prosecutors full access to some confidential information (witnesses' identity, telephone tapping or interception of records, information normally protected by banking secrecy) based on security or privacy reasons.
Some recent developments are worthy of notice. Driven by the need to boost efficiency in the fight against serious crimes, Congress has enacted a series of statutes that contribute to obtain relevant information in criminal investigations. For certain crimes, Law 27,304 allows prosecutors to conclude leniency agreements with defendants willing to provide information material to a case, including the destiny of any assets, property, profits or benefits of the crime. This norm has been used quite effectively in recent corruption cases, such as the Notebooks case. In addition, Law 27,319 brought about relevant changes in the set of tools available to obtain evidence in complex investigations, such as the possibility to use cover agents and offer monetary rewards to whistleblowers. Likewise, a permanent rewards fund for whistleblowers created in 2009 was used to offer monetary rewards in exchange for useful information to trace and recover assets in a high-profile corruption case.