Kleptocrats hiding assets in Swiss banks and investors subject to clawback claims in the U.S., may have something in common. Each could conceivably bear the evidentiary burden of proof in asset recovery cases brought against them. The Swiss Restitution Of Illicit Assets Act (“RIAA”) for example, shifts the burden of proof onto crooked politically exposed persons or suspected kleptocrats.
As explained at “Recovering Assets In Switzerland Hidden By Dictators“, the RIAA freezes a kleptocrat’s assets by presuming said assets are from a public corruption scheme. When a kleptocrat’s assets are frozen pursuant to the RIAA, the kleptocrat bears the burden of proving his / her assets have legitimate origins:
(Click Below For A Full View Of The RIAA)
A U.S. court similarly shifted the burden of proof in one particular asset recovery case involving the clawback of investors’ profits. As more fully set forth by “Clawback Caused By A Ponzi Scheme“, the Bayou Court placed the burden of proof onto investors thought to have acquired profits from a Ponzi scheme / securities fraud. The Bayou Court shifted the burden of proof by asserting in its October 16, 2008 Decision, that the investors had been the transferees of presumptively fraudulent assets.
The Bayou Decision and the RIAA are however, both contrary to the ordinary rule requiring governmental authorities or other claimants to bear the burden of proof during an asset recovery. Perhaps most important is that Bayou and the RIAA raise today’s question: Will shifting evidentiary burdens of proof become a future asset recovery trend?
Translated Copy Of RIAA: Courtesy Federal Dep’t Of Foreign Affairs
Copyright 2010 Fred L. Abrams