QUASI-LEGAL "HARASSMENT" IN AN ILLEGAL JUDICIAL SYSTEM

When the legislature drafted the law, it could not have foreseen that a concept in criminal procedure law such as “evidence” would, in some cases, become a powerful tool for exerting pressure and influence on businesses and individuals, and in another, into a pile of worthless material in legal proceedings. This situation has arisen, on the one hand, because certain “commercial” investigators and prosecutors, without distinguishing between the guilty and the innocent, rake through everything they can get their hands on during searches and seize whatever they find, and subsequently manipulate this evidence in the proceedings. On the other hand, it stems from—to put it mildly—a lack of understanding, on the part of both investigators and investigating judges, of the legal categories of “physical evidence,” “documents,” and “documents as physical evidence.” In both cases, unfortunately, an ordinary citizen—who, by law, is not supposed to be a fool—ends up looking very much like one in court when faced with this mountain of material.

Articles 98, 99, 357, and 358 of the Criminal Procedure Code of Ukraine set forth a clear list of what constitutes physical evidence and what constitutes a document, as well as the method for examining physical evidence, documents, and documents that serve as physical evidence, namely:

PHYSICAL EVIDENCE

According to Article 98 of the Code of Criminal Procedure of Ukraine, physical evidence consists of material objects:

that were used as instruments in the commission of a criminal offense, bear traces of such an offense, or contain other information that may be used as evidence of facts or circumstances established during criminal proceedings,
including items that were the subject of criminally unlawful acts, money, valuables, and other property acquired through criminally unlawful means, or obtained by a legal entity as a result of the commission of a criminal offense.

Instruments of a crime are objects and substances used by the perpetrator to achieve a criminal result. They constitute an element of the forensic characterization of a crime.

In a narrow sense, a physically recorded imprint (traces of hands, feet, weapons, or tools). In a broad sense, the result of any physical change to the original scene resulting from the commission of a crime. These involve a disruption of the original position, location, or condition of various objects that constitute the physical environment in which the crime was committed; that is, they encompass a complex of elements (traces of a traffic accident, a fire).

Trace formation is the process of creating any physical manifestation of an event, defined as the process by which an object’s properties change as a result of interaction with another object during an event. The process of contact between at least two objects, during which the identifying object perceives and reflects the external properties of the identified object.

The object of a crime is an element of the crime’s composition formed by social relations protected by criminal law, within the scope of which harm is caused or a threat of harm is created (a mandatory element), and also includes the subject matter of the crime and the victim of the crime (optional elements).

Documents may also serve as physical evidence, but only if they possess the characteristics of physical evidence—that is, if they were the instrument or object of criminally unlawful acts.

Accordingly, by their procedural nature, written documents can be either ordinary documents or documents serving as physical evidence. Documents serving as physical evidence are significant for the investigation of criminal proceedings not only because of their content but also due to the very fact of their existence, as well as the manner of their creation and other material characteristics. Documents serving as physical evidence are not replaced during proceedings, as they are either the instrument or the object of criminal acts.

DOCUMENTS

A document is a physical object specifically created for the purpose of preserving information, containing data recorded by means of written symbols, sound, images, etc., which may be used as evidence of facts or circumstances established during criminal proceedings.

Written evidence, in the form of documents, is relevant to establishing the truth solely by virtue of its content and, accordingly, may be replaced in the proceedings by copies or duplicates.

Documents—provided they contain the information specified in Part 1 of Article 99 of the Criminal Procedure Code of Ukraine—may include:

- photographic materials, audio recordings, video recordings, and other information carriers (including electronic ones);

- materials obtained as a result of measures taken during criminal proceedings as provided for by applicable international treaties, the binding nature of which has been approved by the Verkhovna Rada of Ukraine;

- protocols of procedural actions and their annexes, drawn up in accordance with the procedure provided for by this Code, as well as information media on which procedural actions have been recorded using technical means;

- audit findings and inspection reports.

Materials containing factual data on unlawful acts committed by individuals or groups of individuals, collected by investigative units in compliance with the requirements of the Law of Ukraine “On Investigative Activities,” provided they meet the requirements of this article, constitute documents and may be used as evidence in criminal proceedings.

EXAMINATION DURING COURT PROCEEDINGS

- physical evidence—is examined and presented to the participants in the court proceedings for review;

- documents (if they contain and certify information relevant to establishing facts and circumstances) — are read aloud at the court’s initiative or upon the motion of the parties to the court proceedings.

SEIZURE OF NON-CASH FUNDS AS PHYSICAL EVIDENCE

In the context of the provisions of Article 170 of the Code of Criminal Procedure of Ukraine, seizure of property is the temporary deprivation, by order of an investigating judge or a court, of the right to dispose of, manage, and/or use property for the purpose of securing physical evidence, special confiscation, confiscation of property as a form of punishment, and compensation for damages.

When considering the institution of seizing property to secure physical evidence, namely, the seizure of non-cash funds belonging to a legal entity or an individual held in accounts at banking institutions, it should be noted that such actions are unlawful in any case.

       The general rule applied when seizing property—that the property must meet the criteria for physical evidence specified in Article 98 of the Code of Criminal Procedure of Ukraine and that there are specific risks associated with its use, movement, etc.—is erroneous.

Such property must be a tangible object, based on the literal definition of physical evidence, but non-cash funds do not qualify as such.

National legislation lacks a clear definition of non-cash funds that establishes their legal nature. Monetary claims belonging to individuals are not money from any perspective. Ukrainian legislation refers to the non-cash form of money, non-cash forms of settlement, and forms of payment transactions (the Law of Ukraine “On Banks and Banking Activities,” the Law of Ukraine “On State Guarantees for the Restoration of Citizens’ Savings,” and the Law of Ukraine “On the Use of Payment Transaction Registers in the Sectors of Trade, Public Catering, and Services”).

A key piece of legislation in this regard is the Law of Ukraine “On Payment Systems and Fund Transfers in Ukraine,” which can be considered one of the fundamental laws in this field. Article 3.1 of this Law stipulates that funds exist in cash form (in the form of banknotes) or in non-cash form (in the form of entries in bank accounts). Electronic money, for example, is issued and redeemed in exchange for cash.

The legal nature of non-cash funds cannot be equated with tangible property; they constitute a separate category of objects of civil rights because they are fungible.

Non-cash funds differ significantly from property rights of claim — they serve as a universal measure of the exchange value of property, are legally required to be accepted as a means of payment, restrictions on their circulation are possible only on the basis of law, they are owned by the holder of a bank account; they may serve as the object of a subjective property right of claim; they are not subject to a statute of limitations; and their value (exchange value) is guaranteed by law.

The legal nature of non-cash money, as objects of civil legal relations, fundamentally distinguishes it from property rights capable of being the subject of a claim.

         A ruling on the recognition of physical evidence as having prejudicial significance for this proceeding is also not applicable, since the Criminal Procedure Code of Ukraine does not provide for the legal category of “recognition of physical evidence.”

At the pretrial investigation stage, the legal category of “factual data” is used. This position is consistent with Part 1 of Article 84 and Part 2 of Article 91 of the Code of Criminal Procedure of Ukraine, which define the following legal framework:

EVIDENCE – FACTUAL DATA on the basis of which the pretrial investigation authority establishes – FACTS and CIRCUMSTANCES.

Evidence is recognized as material evidence only by the court in the deliberation room after it has been examined during a court hearing through adversarial proceedings and only if it is relevant and admissible. This position is consistent with Articles 85, 86, and 92 of the Code of Criminal Procedure of Ukraine. The investigator and the prosecutor are not the parties responsible for recognizing factual data as physical evidence, as they are merely responsible for compiling and preliminarily assessing the factual data for its future submission to the court.

If we assume that the seizure of non-cash funds is indeed possible, then the investigator and the prosecutor must have a clear understanding of exactly which property is subject to seizure, its quantitative characteristics and generic features, and an understanding of which account these funds were received from and through which business transactions. To this end, at a minimum, an inspection report must be drawn up, which must be preceded by the investigator’s or prosecutor’s temporary access to the accounts and related banking documents. This position is consistent with paragraph 2 of Part 1 of Article 170 and paragraph 2 of Part 2 of Article 171 of the Criminal Procedure Code of Ukraine, which establish the rules for the seizure of property, stating that “the investigator and the prosecutor must take measures to identify the property”, “the motion for seizure shall specify the list and type of property.” In other words, the so-called “remote” submission of a motion to the court by an investigator or prosecutor—without any understanding of, at a minimum, the amount and flow of non-cash funds—clearly demonstrates the prosecution’s blatant disregard for the law.

The seizure of non-cash funds in bank accounts must also be consistent with the purpose and objectives of the criminal proceedings in accordance with the general rules of pretrial investigation.

In summary, non-cash funds, by their legal nature, cannot meet the criteria for physical evidence specified in Article 98 of the Criminal Procedure Code of Ukraine, since they are not tangible objects, are fungible assets, and cannot:

- serve as an instrument of a criminal offense

- bear traces of a crime

- be classified as money or other items acquired through criminal means, or received by a legal entity as a result of committing a criminal offense, since the provision of the article explicitly refers to the legal category of “items.”

Based on the foregoing, during a pretrial investigation, non-cash funds cannot in any way be recognized as physical evidence, nor can they meet the criteria for physical evidence, and all attempts by pre-trial investigation authorities to seize non-cash funds on the grounds that they meet the criteria for physical evidence lack a legal basis. The situation is particularly exacerbated when there is an attempt to freeze non-cash funds remotely, without inspecting them and without obtaining temporary access to bank accounts and documents. Any actions by the prosecution to freeze non-cash funds on the grounds that they meet the criteria are nothing more than quasi-legal hooliganism.