Dispute Resolution | Criminal Law

Denis Ovcharov,
attorney-at-law, partner, White Collar Crime at Juscutum

Kseniya Prokonova,
attorney-at-law, senior associate, White Collar Crime at Juscutum

They will search in and out. Search in and out

The rules of business now require that a company security system be properly organized, for nobody is immune from searches. Not only companies can, but also they should, get prepared for searches. The company security plan should definitely include regular internal and external audits, a credibility control of business partners and employees, a consistent strategy of dealing with law-enforcement and well-timed PR campaigns.

Mid-December 2015 will be a time busy not only with searching for holiday gifts,but also with thea burdensome expectation of reform implementation of reform. By this time, the part of the law on the prosecution service that eliminates the old prosecutors will come enter into force. What does the reform bring for business? Unfortunately, it entails, first of all, searches in progression. The old prosecutors will not give way for to the new ones without a compensation. When attempting at a SWOT-analysis of the actions of law- enforcement bodies, one has to consider that its his opponents are 23-25 year old young people with zero experience or knowledge of in business development. All they learned atin their age is taking away and divvying upiding, and not exclusively in accordance with the CPC. LThe law- enforcement officials use their positions office predominantly to improve their own well-being. State interests come into playce only where there is personal interest as well. Any reform is accompanied by investigative actions.


In this situation, it is necessary to be prepared. The key capital of the company’s owner is the team, the people. A search is the most effective team- building exercisze. It is during a serarch, rather than a corporate party, that there is a real opportunity to assess resistance to stress, team building and other loud words usually mentioned in a CV. Why is it important to prepare the staff before a search? The answer is that, when hiring them, you were looking for other qualities, i.e. professional skills. You did not task them with being your lawyers. However, the rules of business these days require that there be a proper system of security within the company in addition to the quality of your product or service.


This component is of equal value to the corporate social responsibility, since destruction of your business will lead to your staff losing their jobs and their families suffering as a result. It is crucial for everyone in the company to have an understanding and appreciation of this aspect. It brings people together much better than a mission and a vision do. One cannot protect a company without an inambiguous understanding of the fact that you are on the good side fighting the army of evil.


What does an effective security plan include? It consists of mprises algoryithms of behaviour that are clear to each employee + physical security of the office + a proper security service cooperating with lawyers and financial experts. Regular internal and external audit, verification of contractors, a consistent strategy for dealing with the law- enforcement bodies, as well as proper and timely PR activities are the necessary components of the company’s secuirty plan. The algorythms are crucial for both an internal understanding


Algoriythms are crucial both for internal understanding that everything is in accordance with the rules, and also to have a reason to deny law- enforcement officials certain actions. The employee is more confident in the presence of an investigator when he can refer to a provision contained in internal regulations. The pPhysical safety of the company means how easy it is to get come to you. There can be a lot more doors in your company than you think, as well as people willing to open these doors to strangers.


A proper security service has to cooperate with the lawyers and financial experts. Everyone has to do their job. When people try to take on additional authority and act like bosses while failing to perform their duties, it does not bring good outcomes. When an accountant is answering questions instead of lawyers, there will surely be a search. The security service should not simply listen to gossip from previous places of employment work and keep the company in permanent anticipation of a search. However, the most important part is a unified strategy for all units when it comes to dealing with the law- enforcement bodies. The strategy must be consistent. Otherwise, they will come to you over and over again.


Verification of contractors is necessary in the light of a recent tendency, namely terrorism sponsorship charges. Elements of this crime can be alleged in the actions of virtually any company. These may be related to the facts that your employees relocated from Donetsk and Luhansk; you used to run a business on the territory that is no longer controlled by Ukraine; you have received e-mails from different “Ministries” of the Donetsk People’s Republic; your contractors have transferred funds to the accounts of companies registered in Donetsk… The variations of such scenarios are endless. However, the practice shows no mercy: even if the search is held under Articles 205 and 209 of the Criminal Code, charges of sponsoring terrorism will appear in the process. This serves as justification for multiple violations during searches, as well as the presence of armed people in masks on the territory of a seemingly peaceful company.


In all the cities where the new police is already functioning, including Kyiv, Odesa, and Lviv, there is an additional tool for tackling the lawlessness. The police can serve as a “third force” capable of stopping violations of human rights and mockery of the CPC during searches. However, in practice, the police cannot always use its rights and powers. Therefore, they it needs guidance. What does it include? First of all, describe the situation clearly when you are calling the police. When your call is simply about an unwelcome visit, it is still a reason, however, it lacks information. Police can take your lawyer with them to the search site since the investigator can restrict exit from the premises in accordance with the CPC. The investigator interprets it as “nobody move” and does not let anyone enter. This is a violation of the CPC as the restriction applies to exit only. You need to draw the attention of the police to the fact that you are requesting the presence of a lawyer, and the lawyer is trying to get through, or that you have not received the court order, or the order does not indicate the address, or there is no video recording of the process, etc. These aspects are very important during a search as they constitute gross violations.

Recently, the need to amend the CPC has been a subject of discussion as it does not include a detailed regulation of a search procedure. Moreover, there are numerous vague phrases in the Code allowing for abuse of power by investigators who already have a broad authority. For this purpose, we are members of the working group drafting the relevant bill. However, we are now dealing with the existing provisions, and it is necessary to know how to operate within this framework.

Until recently, large companies felt safe as they were contributing to the state budget and could protect themselves in European institutions. Previously, there were no risks of such investigative actions for large companies, as it concerned predominantly medium-sized and small businesses. However, the country is going through a crisis, and there is a quest for new sources of revenue for the budget. The rational elle of the law- enforcement is that an attempt to block the operations of a large company will lead to pay offs and income for both the state and their personal budget. A wise PR strategy developed prior to the “visit” by the guests, plays an important role under these circumstances.


Anticipating stronger resistance and internal security service, they come with this search masquerade show specifically to large companies. These shows will not end in the nearest future since it is the easiest way to find leagl grounds for searches and arrests of politicians and officials. Unlike in the US, there is no such thing as an arrest warrant in our country. Therefore, arrests are performed in the way they are broadcasted on the TV and online. These days, the trend is by far not to stop using gunmen with face masks during investigative actions.

A search is a test for lawyers and friends. You can tell how effective your lawyer is already by his efforts to battle through to you. Has the lawyer called the police on the count of a possible kidnap ping and detention of a client? Has the ambulance come to rescue you from all the diseases that went into the acute stage under stress? At the same time, you should also help the lawyer. Someone who really wants to receive legal aid will not take the cue from the investigators and continue with the search while the lawyer is at the door. You have to act together in this situation.


They have no right to search a lawyer. Just remember this. Also, remember that the fact that they came to you is better than an award or a place in the top rankings. A criminal case, particularly in relation to sponsoring terrorism, is the best recognition of a professional success.