Criminal Law White-Collar Crimes

partner at Arzinger LF, attorney, head of the criminal law and business protection practice

Show your true colors

From November 4, 2018, the so-called Stop Masks-Show Law No. 2 came into force (the Law of Ukraine "On Amendments to the Criminal Procedure Code of Ukraine Concerning Ensuring Respect for Rights of Participants in Criminal Proceedings and Other Persons by Law-Enforcement Agencies During a Pre-Trial Investigation") (published on November 3, 2018).

Previously, in December 2017, the first law of the same Stop Masks-Show series came into force (the Law of Ukraine "On Amendments to Certain Legislative Acts Concerning Ensuring Respect for Rights of Participants in Criminal Proceedings and Other Persons by Law-Enforcement Agencies During a Pre-Trial Investigation").

Paradoxically, but none of these laws contain provisions regulating the issue of use of law-enforcement agencies (called "masks-show" because law-enforcers wear masks and appear aggressive) during a search. By the way, only the APB letter, dated October 5, 2017, signed by Yuriy Lutsenko, Prosecutor-General of Ukraine, contains some kind of guidance on this issue.


Are things really that bad?

There are more than enough publications on the Stop Masks-Show Laws that can appear under the "treachery" hashtag. Therefore, I would like to start with the good news, i.e., with the positive trends that are observed.

The first Stop Masks-Show Law provides that a search shall be recorded by video recording media and this significantly disciplined the investigators. For example, we have already had the opportunity to accompany a search, on which only a limited number of employees of the client's company were informed (in fact, only those whose involvement was necessary for the purpose of providing documents specified in the investigative judge’s order on search). The other employees of a large company, as on a typical working day, worked in their offices, occasionally sipping coffee and not even knowing what was happening in one of the meeting rooms. Meanwhile, the investigators patiently waited for the next "portion" of documents specified in the order issued by the investigating judge.

We try to convince our clients that things are never as bad as they seem. At the same time, we are fully aware of the fact that such searches, more resembling temporary access to documents, are unfortunately far from being the established practice. Although we still note that law-enforcement officers are increasingly taking these things into account when they go to carry out  a search. For example, in companies with international capital, tuned compliance, and "white" approaches to work, law-enforcement officers do not perform masks-show.


What's the news?

The Stop Masks-Show Law No. 2 provides for greater responsibility of the investigator and the prosecutor:

— the investigator and the prosecutor now bear financial responsibility to the state for any damage caused;

— the right for damage reimbursement arises when the investigating judge satisfies complaints against actions of the investigator and the prosecutor;

— satisfaction of such a complaint serves as the basis for performing an official investigation and applying disciplinary sanctions.

The mechanism for closing criminal proceedings that were initiated unreasonably has been worked out in detail:

— participants in criminal proceedings shall have the right to submit a request to the investigator and the prosecutor for closing criminal proceedings, if there is a ruling on similar facts;

— refusal to close criminal proceedings on these grounds can be appealed against to the investigating judge in court;

— closure of criminal proceedings by the investigating judge at the request of a person in connection with expiry of the investigation terms.

The list of orders of the investigative judges, which can be appealed against, has been expanded:

— on the extension of dismissal from office;

— on the closure of criminal proceedings in connection with the completion of the pre-trial investigation;

— on the refusal to satisfy the complaint against the decision of the investigator and the prosecutor regarding the refusal to close criminal proceedings, if there is a ruling under similar circumstances.


Observations instead of findings

Not so long ago, when attending an international conference, we shared our experience with foreign colleagues. We, Ukrainians, have a bad habit of complaining, focusing only on bad things and rhapsodizing over the practice of foreign jurisdictions. At the same time, colleagues from the United States complain that law-enforcement officers aggressively propose the making of a deal on the spot as a result of which more than 90% of cases end with a deal. Our British colleagues unanimously say that in fraud cases they often have to work for the investigator (luckily, they have the institute of private prosecution) and also pay attention to the demotivation of law-enforcement officers since, for this country, they receive low salaries. Polish lawyers are dissatisfied with the fact that their investigators and prosecutors who are involved in criminal cases on tax evasion, are clueless about taxes. It was like deja vu with our own day-to-day realities.

Although one should always assume that legal culture in more developed jurisdictions is significantly higher. Consequently, the legal culture of law-enforcement officers is higher as well. At the same time, we are optimistic about the future and are working together on the next stop masks-show initiatives.