Last month, I saw a news report about the international reaction to the Ukrainian Constitutional Court’s decision striking down Ukraine’s criminal offense of “illicit enrichment” as unconstitutional. For those unfamiliar with this topic, the crime of “illicit enrichment” makes it a criminal offense for a public official to realize a significant increase in his or her assets that the public official cannot reasonably explain. The crime of illicit enrichment is related to, but distinct from, civil asset forfeiture systems under which the government may seize—as presumptively the proceeds of unlawful activity—assets that the owner cannot reasonably explain. The main difference is that a civil forfeiture order results in the loss of assets, while a criminal offense can result in fines or incarceration, as well as the other collateral consequences of a criminal conviction. Some anticorruption activists support the criminalization of illicit enrichment on the grounds that it is often difficult or impossible to prove the underlying corruption offenses, but a substantial unexplained increase in a public official’s wealth is sufficient to prove that the official is corrupt. Critics warn that criminalizing illicit enrichment is incompatible with traditional notions of the presumption of innocence. (The UN Convention Against Corruption (UNCAC), perhaps unsurprisingly, fudges the issue, with UNCAC Article 20 calling on States Parties to “consider” adopting an illicit enrichment offense, “[s]ubject to [that country’s] constitution and the fundamental principles of its legal system.”)
In its decision last February 26, Ukraine’s Constitutional Court went with the critics, holding that the criminalization of illicit enrichment a criminal offense was an unconstitutional infringement on the presumption of innocence. This decision met with swift condemnation from the G7, which issued a joint statement with the World Bank declaring that the “recent elimination of the illicit enrichment offence from [Ukraine’s] criminal code is a serious setback in the fight against corruption” that has “weakened the impact of the whole anti-corruption architecture.” Illicit enrichment, the G7 and World Bank admonished, “is not a new offence. In 2010 there were more than 40 countries that criminalized illicit enrichment,” and “[c]ourts around the world have recognized that the criminalization of illicit enrichment is a powerful tool in the fight against corruption, while at the same time respecting fundamental human rights and constitutional principles such as [the] presumption of innocence[.]” The G7-World Bank joint statement closed by calling on Ukrainian authorities to “reinstat[e] criminal liability for illicit enrichment in line with UN, OECD, and [European Court of Human Rights] principles.”
Now, as a policy matter, I tend to agree with the G7-World Bank position here. I think that appropriately tailored and cabined illicit enrichment offenses can be useful tools, and (as others have also pointed out), it’s not true that such offenses have any inherent conflict with the presumption of innocence. Nonetheless, I found the letter an exercise in outrageous, condescending hypocrisy, one that the G7 countries in particular should be ashamed to have written.
The reason is simple: Unless there have been significant recent legal changes of which I am unaware, not a single G7 country criminalizes illegal enrichment. The list of 40+ countries that had illicit enrichment offenses as of 2010, which I’m fairly certain was the joint letter’s source for its tut-tut chiding of Ukraine, does not include any G7 countries. Moreover, while for some of these countries the reason for not adopting an illicit enrichment offense is not clear, and might spring from inertia or the sense that such an offense is unnecessary given the nature and extent of the country’s corruption problem, for at least two G7 countries—the US and Canada—the reason for not adopting an illicit enrichment crime is exactly the same as that offered by Ukraine’s Constitutional Court, namely concerns about incompatibility with the constitutional commitment to the presumption of innocence.
The reason we know this is because the Inter-American Convention Against Corruption (IACAC), to which both Canada and the United States are signatories, includes an article (Article IX) calling on States Parties to criminalize illicit enrichment. And when Canada and the US signed on to the IACAC, they both filed reservations to that article, explaining that an illicit enrichment crime would contravene their constitutionally-grounded notions of the presumption of innocence in criminal cases. The text of the US treaty reservation stated:
The offense of illicit enrichment as set forth in Article IX of the Convention … places the burden of proof on the defendant, which is inconsistent with the United States constitution and fundamental principles of the United States legal system. Therefore, the United States understands that it is not obligated to establish a new criminal offense of illicit enrichment under Article IX of the Convention.
And Canada likewise filed an IACAC reservation that declared:
As the offence contemplated by Article IX [illicit enrichment] would be contrary to the presumption of innocence guaranteed by Canada’s Constitution, Canada will not implement Article IX, as provided for by this provision.
So where to these countries get off lecturing Ukraine about how an illicit enrichment crime is essential to combating corruption and that such an offense does not contravene the presumption of innocence? How dare the G7 countries lecture Ukraine about how “more than 40 countries” have criminalized illicit enrichment, when none of zero of those 40-plus countries are in the G7? How could this happen.
Actually, I have a feeling I know how this happened. I suspect that none of the G7 officials involved in drafting or signing onto the statement to Ukraine actually know much about their own country’s legal systems, nor about the position their respective countries have taken in prior anticorruption treaty negotiations. But still, this is a bad look.
Just one more time, for the record: My beef with the G7 letter is not with the content. I think the Ukrainian Constitutional Court was wrong, and the G7 letter correct, on the substance. I therefore also think that the reservations filed by the US and Canada to Article IX of the IACAC are misguided. But boy, if there were an annual “Do as I Say, Not as I Do” award in the anticorruption field, this G7 letter would be an early favorite to win. Unfortunately I fear there’s plenty of competition for that dubious honor.
These are fair points and I may be drawing a fine line here, but I think the G7 criticism is more concerned with Ukraine’s overall direction of travel – and what abolishing the offence of illicit enrichment means in that context – than with the criminalisation of illicit enrichment as such. As we all know, Ukraine’s corruption problems are much more acute than those in G7 members; hence Ukraine has resorted to quite a few measures outside the ‘normal’ anti-corruption toolkit (including the criminalisation of illicit enrichment and the creation of several dedicated anti-corruption agencies and an anti-corruption court). So, my take is that the G7 is frustrated with Ukraine throwing one of these tools out of the window, especially in the circumstances when a number of investigations have now been closed as a result. I think this context is much more central to the G7 statement than its signatories’ disagreement with how Ukraine’s Constitutional Court interprets the presumption of innocence – which, as you quite rightly say, is on the face of it similar to interpretations accepted elsewhere (although the pedant in me has some questions to ask about the court’s reasoning, especially its rather selective treatment of the ECHR case law).
I don’t think we really disagree, at least about anything important. My point was more that G7 countries like the US and Canada aren’t in a great position to deliver a stern moral lecture about the importance of illicit enrichment laws, and their lack of conflict with the presumption of innocence, given those countries’ own laws and prior statements.
At the very least, if the G7 is going to criticize Ukraine here (and, like you, I think criticism is warranted), at the very least it would have been nice for the statement to include some of the context you describe.
G-7 hypocrisy aside, I’m not sure I buy the argument that criminalizing illicit enrichment is unconstitutional, provided there are adequate safeguards to bringing a case. To me, violating “innocent until proven guilty” would be barring an official from their job after an accusation of illicit enrichment. Here, I have a hard time believing anyone unable to explain a large increase in their assets came by those assets legally, and merits protection. Why the constitutional pushback? I can see some situations in which it might be better to have the offense be civil rather than criminal (say your parents benefited from illegal activity and left you all of it though you weren’t involved), but I have a hard time buying into the argument that a conviction on illicit enrichment grounds overcomes the presumption of innocence. For anyone who has legally acquired their money, isn’t it a very low burden of proof?
I agree completely. I don’t think it’s in fact correct, as a matter of constitutional/legal analysis, that the burden-shifting inherent in an illicit enrichment offense contravenes the presumption of innocence or other traditional notions of due process.
That said, the concern is not totally off the wall. There may well be a point at which presuming guilt based on weak/thin indicia of wrongdoing, and then requiring the defendant to refute that presumption with strong, hard-to-acquire evidence, might be inconsistent with the presumption of innocence. But as you say, in this case there doesn’t seem to be a strong argument.
I think the mistake that countries like the US and Canada made was raising the presumption-of-innocence point as a reason to file a reservation to the IACAC’s article on criminalization of illicit enrichment. Having done so, and not having indicated any reconsideration of that position, it makes it harder for those countries to object to something like the Ukrainian court decision.
Lithuania was among the countries that adopted amendments criminalizing illicit enrichment in 2010. I was closely following the discussion back then and there were some criminal law academics who were raising the question of its constitutionality in our country as well. Unsurprisingly, the case reached our Constitutional Court as well and it ruled it was, in fact, constitutional (15 March, 2017). The main arguments for constitutionality were that the Criminal Code article criminalizing illicit enrichment itself does not define the process of how the prosecution needs to argue the case and that it is still defined in the Criminal Procedure Code (as would be the case in many countries, I think). The procedural rules provide that Prosecution must analyze the case and prove the existence of a crime and that Defense has a right to challenge that, but does not have an obligation to prove that the crime has not been committed. In other words, the Court ruled that the presumption of innocence is not breached, because the Prosecution still has to provide enough evidence to explain why the assets in question could not have been acquired legally. The Court also ruled that the article does not breach the person’s right to defense, since other laws clearly define what assets are considered to be “illegally obtained”, furthermore, the construction of illicit enrichment does not entail holding people criminally liable for recklessness unless the assets in question are worth more than a set amount of money (quite high in LT standards).
To be honest, I lean towards supporting illicit enrichment criminalization ideologically, but those arguments felt a little bit weak at some points. In fact, I am yet to see really sound arguments for its constitutionality (of course it may differ in different countries because of different constitutions, but the core principles of criminal law are similar in European states and the US). For example, I would really see why it could be challenged on constitutionality grounds in terms of how the right to defense can be exercised in these cases. But then again, I am not criminal law buff, so maybe our Constitutional Court covered all bases.