Extended Confiscation
Poland’s most aggressive asset-seizure law flips a fundamental principle of criminal justice: now you must prove your innocence.
In March of 2017, the Polish Parliament passed a statute that, had it been proposed in most Western democracies, might have occasioned weeks of public debate, parliamentary hearings, and impassioned editorials. In Warsaw, it slipped through with relatively little fanfare. The law amended Article 45 of the Polish Criminal Code, establishing what is known as konfiskata rozszerzona—extended confiscation—and it represents perhaps the most far-reaching tool the state has ever granted itself in its campaign against economic and organized crime.
The mechanism is elegant in its severity. Under the traditional rules of criminal forfeiture, prosecutors bore the burden of demonstrating that specific assets derived from a specific crime. Extended confiscation dispenses with such niceties. It presumes—legally presumes—that all property acquired by a defendant within five years of committing a crime is tainted by that crime, unless the defendant can prove otherwise. The shift is not subtle. In the architecture of criminal law, where the presumption of innocence has long served as a load-bearing wall, this represents something approaching demolition.
The statute applies in two broad categories: cases involving proceeds exceeding two hundred thousand złoty (roughly fifty thousand dollars), and serious offenses—those carrying maximum sentences of five years or more, or crimes committed in connection with organized criminal enterprises. In the latter category, prosecutors need not even demonstrate that the defendant actually profited; the mere possibility of financial gain suffices.
What makes the law particularly striking is its treatment of third parties. Property transferred to spouses, business partners, shell companies, or distant relatives falls under the same presumption. Everything in their possession, every legal right they hold, is deemed to belong to the defendant—unless they can establish that, given the circumstances of the acquisition, they could not reasonably have suspected its illicit origins. The good-faith defense exists, but it is narrow, and the burden of invoking it falls squarely on those whose assets hang in the balance.
The constitutional objections practically write themselves. Poland’s Charter, like those of most democratic nations, enshrines the presumption of innocence. Article 42 declares that anyone accused of a crime shall be presumed innocent until proven guilty by a final court judgment. Extended confiscation inverts this principle with respect to property, demanding that the accused prove a negative—that they did not, at some unspecified point over the preceding half-decade, commit crimes from which their wealth might have flowed. The prohibition against retroactivity, another cornerstone of criminal law, was similarly tested: Article 23 of the enabling legislation permitted the new provisions to be applied to assets acquired before the statute’s enactment, a move critics derided as a fundamental breach of legal tradition.
The European Court of Human Rights, for its part, has offered Poland some cover. In a line of cases stretching back to Raimondo v. Italy in 1994 and extending through Gogitidze and Others v. Georgia in 2015, the Strasbourg court has held that member states enjoy considerable latitude in regulating property suspected of criminal origins, including the authority to shift evidentiary burdens onto defendants. The caveat—and there is always a caveat—is that such regimes must be administered through judicial procedures that preclude arbitrariness and guarantee meaningful opportunities for defense. Whether Poland’s implementation meets this standard remains, in many cases, an open question.
The practical consequences have been documented, with some alarm, in the Polish legal press. Prosecutors, armed with these expanded powers, have grown creative. In one notable case decided by the Warsaw Regional Court in July of 2020, authorities had attempted to seize funds from a company’s bank account by classifying the money as “physical evidence” in an ongoing investigation—thereby circumventing the requirement of a court judgment altogether. The court rejected the maneuver, calling it an unacceptable assault on civil liberties, but the episode illustrated how readily such tools can be stretched beyond their ostensible purposes.
The broader critique has been articulated with particular force by legal commentators who see in extended confiscation the leading edge of a more general expansion of state power. The problem, as Hayek warned in the closing pages of The Road to Serfdom, lies not in who wields authority but in the scope of authority available to be wielded. As long as that scope encompasses confiscation without conviction, asset seizure grounded in suspicion, and presumptions of guilt, we inhabit a system in which anyone might become the victim of mechanisms they once helped to create.
Extended Confiscation – Our Publications
Robert Nogacki: The Boomerang: How Instruments of Repression Turn on Their Makers
As Hayek warned in the closing pages of The Road to Serfdom: the problem lies not in who wields power, but in the scope of power available to be wielded. So long as that scope encompasses confiscation without conviction, asset seizure grounded in suspicion, and the presumption of guilt—we shall live in a system where anyone may become the victim of mechanisms they themselves helped create.
Robert Nogacki: Criminal Asset Forfeiture and Extended Confiscation
Implementation of the Directive will generate novel challenges for both law enforcement authorities and legal practitioners. From a defense perspective, proactive documentation of asset legitimacy assumes critical importance—particularly given the heightened risk of prosecutorial asset seizure at early procedural stages.
Robert Nogacki: Mega-Extended Confiscation, or How Prosecutors Seize Corporate Funds Despite Lacking the Authority to Do So
2020-08-24: To confiscate funds belonging to a company, prosecutors must obtain a court judgment establishing that the company was used to commit a crime. This naturally requires law enforcement to prove that the entrepreneur or other entity operating the business was culpable in committing a crime through the use of the enterprise. For years, however, prosecutors have employed a certain maneuver that allows them to circumvent these requirements and seize company funds held in bank accounts without a court judgment or charges being filed against anyone—they designate the funds as physical evidence in an ongoing case. The Warsaw Regional Court, ruling in favor of an entrepreneur on July 22, 2020, deemed such prosecutorial conduct unacceptable practices that violate civil rights and liberties.
Robert Nogacki: Classifying Funds Held in a Bank Account as Physical Evidence
2020-08-21: A frequently employed practice by prosecutors—though one of dubious legality—is the classification of funds held in a bank account as physical evidence.
Robert Nogacki – licensed legal counsel (radca prawny, WA-9026), Founder of Kancelaria Prawna Skarbiec.
There are lawyers who practice law. And there are those who deal with problems for which the law has no ready answer. For over twenty years, Kancelaria Skarbiec has worked at the intersection of tax law, corporate structures, and the deeply human reluctance to give the state more than the state is owed. We advise entrepreneurs from over a dozen countries – from those on the Forbes list to those whose bank account was just seized by the tax authority and who do not know what to do tomorrow morning.
One of the most frequently cited experts on tax law in Polish media – he writes for Rzeczpospolita, Dziennik Gazeta Prawna, and Parkiet not because it looks good on a résumé, but because certain things cannot be explained in a court filing and someone needs to say them out loud. Author of AI Decoding Satoshi Nakamoto: Artificial Intelligence on the Trail of Bitcoin’s Creator. Co-author of the award-winning book Bezpieczeństwo współczesnej firmy (Security of a Modern Company).
Kancelaria Skarbiec holds top positions in the tax law firm rankings of Dziennik Gazeta Prawna. Four-time winner of the European Medal, recipient of the title International Tax Planning Law Firm of the Year in Poland.
He specializes in tax disputes with fiscal authorities, international tax planning, crypto-asset regulation, and asset protection. Since 2006, he has led the WGI case – one of the longest-running criminal proceedings in the history of the Polish financial market – because there are things you do not leave half-done, even if they take two decades. He believes the law is too serious to be treated only seriously – and that the best legal advice is the kind that ensures the client never has to stand before a court.
