In 2017, the German law of criminal asset forfeiture was newly regulated. Following the law of the European Union, the term “forfeiture” was changed. Now the term “confiscation” is used. The primary purpose of this legal reform was to facilitate the provisional seizure of assets and to make subsequent confiscation possible. This amendment aimed to ensure that the lawful property relationship is restored.
The German law firm Schlun & Elseven offers private individuals whose assets have been confiscated competent and committed legal assistance. Our German criminal law team represent your interests and develops strategies to recover your seized assets. Our legal experts’ precisely crafted defence strategy and prudent actions ensure the best possible outcome for you.
Asset Recovery
Asset confiscation means the confiscation of a profit made through criminal offences. After committing a criminal offence, an offender is threatened with a custodial sentence or a fine and, under certain circumstances, with the implementation of asset confiscation as standardised in Sections 73 et seq. of the German Criminal Code (StGB). Section 73 (1) sentence 1 StGB states:
If the offender or participant has obtained anything by or for an unlawful act, the court orders the confiscation of that which was obtained.
In most cases, the provisions of Sections 73 et seq. StGB are primarily applied in connection with offences such as corruption, tax evasion, theft, receiving stolen goods, fraud and violations of the Narcotics Act. In principle, however, asset confiscation is not tied to a specific offence. According to Section 73a (1) StGB, a seizure is also ordered if the objects were obtained through or for another unlawful act. The only prerequisite is that there are indications that convince the court that the “something” obtained through or for the offence is of criminal origin. The term “something” includes assets such as rights in rem, movable objects, etc.
This means that if a person or a company obtains “something” through a criminal offence, it will be taken away from them again. The rule is that the offender should not gain any financial advantage through their actions.
Confiscation According to Sections 73 et seq. StGB
Confiscation of proceeds of crime also includes property of the offender or participant obtained through or for other offences. This follows from the norm on extended confiscation (cf. Section 73a (1) StGB).
Confiscation of Proceeds of Crime from Others
While Sections 73 and 73a StGB regulate the confiscation of assets from the offender and participants, Section 73b StGB regulates the confiscation of proceeds of crime from others. This refers to a person who has been enriched by the unlawful act of another person but is not a perpetrator or participant. The court’s order may be directed against such an enriched person if
- the person has obtained something through the act and the perpetrator or participant has acted on behalf of the person,
- the person has received what they have obtained free of charge or without legal justification, or they realised or should have realised at the time of the transfer of what they had obtained that it was the result of an unlawful act, or
- the acquired property has passed to the person by virtue of their position as heir, beneficiary of a compulsory portion or legatee.
It should be noted that regarding the confiscation of proceeds of crime from others, however, exceptions also apply.
Independent Confiscation under Section 76a StGB
Under Section 76a StGB, the court may order confiscation independently if no specific person can be prosecuted for the offence. This also applies under certain circumstances if prosecution is refrained from or if there is a statute of limitations. According to Section 76a (4) StGB, the confiscation of an asset can also be ordered independently of proof of unlawful trading. However, this is only possible under the conditions that the court is convinced of the illegal origin of the object and that there is a suspicion of one of the offences listed in Section 76a (4) sentence 3 StGB.
Determination of the Value of the Proceeds
Section 73d StGB regulates the determination of the value of the proceeds. The expenses of the offender, participant or other person are deducted from the determination.
The so-called “gross principle” is used to determine the value. During the determination, two steps are then taken to examine the value:
- Consideration of the object of the gain,
- deduction of expenses of the perpetrator, participant or others.
For the latter point, however, the following applies: what was spent or used for the commission of the offence or during its preparation is mostly disregarded (cf. Section 73d (1) sentence 2 StGB).
If the value of the proceeds cannot be determined, it can be estimated according to Section 73d (2) StGB. Particular attention must be paid to the confiscation of surrogates. If a different asset was obtained through the unlawful acquisition, this would be included in the court’s estimate. This also applies to the proceeds of crime from others. However, the prerequisites mentioned above of Section 73b (1) StGB must be fulfilled.
The court may also order the confiscation of a sum of money corresponding to the value of the proceeds according to Section 73c StGB. This is possible if
- the confiscation of the object is no longer possible because of the nature of what was obtained or for other reasons, or
- the confiscation of a substitute object is dispensed with.