An extract from The Asset Tracing and Recovery Review, 8th Edition
Seizure and evidencei Securing assets and proceeds
Once an asset has been located, it is critical to have that asset secured. On the criminal law side, it should be considered how to ensure that the asset can be recovered from the defendant once a conviction is reached. On the civil law side, it should be considered how to avoid the liable person hiding the funds once they have been found, and an order has been issued to return those assets.Criminal cases
In criminal proceedings, provisional measures may be the answer. These have a dual objective. On the one hand they intend to ensure the presence of the defendant during the trial, and on the other they aim to guarantee a victim's redress. Provisional measures may become essential towards assuring the asset recovery or, at least, an equivalent damage repair.
The CNPP provides, in Article 138, the provisional measures that can be ordered by the judge to guarantee a victim's damage repair. In this sense, the victim or offended party or the public prosecutor may request the seizure of goods, or the freezing of bank accounts and other securities in the financial system.
It is crucial to keep in mind that, under the CNPP, these provisional measures are granted if the evidence provided demonstrates that the damage repair is possible and that there is a strong possibility that the defendant is responsible for repairing such damage.
These provisional measures can also be cancelled (hence, lifting the seizure or the unfreezing of bank accounts) if the defendant provides countersecurity for or pays the reparation of the damage. The measures can be cancelled if a conviction is not reached, or if the final judgment exonerates the defendant from the damage repair.
The flip side is that, if a conviction is reached and the defendant is sentenced to repair the damage caused, the provisional measure becomes effective in favour of the victim or the offended party. This means that the seized or frozen assets will be used to pay the victim for their damage. Interestingly, the CNPP provides that the seizure is governed by the rules established in the FCCP.Civil cases
In civil cases, there are also provisional measures that facilitate the recovery of assets at the end of a proceeding. All the procedural codes, whether civil or commercial, provide for interim relief to safeguard the assets that are subject to the aforementioned civil actions. Under the FCCP, interim relief consists of the seizure of assets to guarantee the result of the trial, or the seizure and deposit of the assets encompassing the subject matter of the proceeding.
For example, if a company that suffered a misappropriation of funds has already tracked the person who misappropriated such funds and knows the bank accounts where the person might have the money, the company can request freezing the money in these bank accounts, either before trial or during the trial.
Interim relief can be requested to the court during a trial or before it begins. For the court to grant this, the plaintiff must evidence urgency, namely that there is a real possibility that the assets might be hidden or used by the defendant. Interim relief may be granted ex parte, without hearing the affected party, who will also not be able to challenge the seizure order. However, if the relief is not granted, the plaintiff has the right to challenge the decision.
It is important to note that the plaintiff must guarantee the damage and lost profits that the person affected by the interim relief might suffer. On the other hand, just as in criminal proceedings, the affected party (defendant) can offer countersecurity to lift the seizure order.
The downside of requesting interim reliefs in a pretrial stage is the obligation imposed on the claimant of filing its claim within five days. Otherwise, the injunctive relief is revoked.ii Obtaining evidence
There are no specific rules to obtain evidence in fraud proceedings. Parties must offer all evidence they deem necessary to back their claim or defence. All evidence is admissible when it is aimed at supporting claims or defences. Parties are free to submit and produce any type of evidence – documents, the examination of witnesses, expert witnesses, visits to a specific site, among other things – insofar as the piece of evidence is not illegal or against morality.
Regarding documents, in Mexico claims are required to include all supporting documents from the beginning of the proceedings. As a general rule, a document that has not been submitted with the parties' claim or reply to it is not accepted or considered unless said document was unknown or did not exist at the moment of filing a claim or answer.
When a document is requested as evidence, the request must be specific enough with the document or documents requested; otherwise, the court will not grant it deeming it as a prohibited inquiry according to Article 16 of the Constitution. Under Mexican law, there is very little discovery and there is no mechanism for party-directed document production or depositions.