CASE OF SACCOCCIA v. AUSTRIA
No violation of Art. 6-1;No violation of P1-1
Anatoly Kovler;Christos Rozakis;Dean Spielmann;Elisabeth Steiner;Khanlar Hajiyev;Sverre Erik Jebens
6. The applicant was born in 1958. He is currently serving a prison term in the United States. 7. In 1992, in the context of criminal proceedings for large-scale money laundering conducted against the applicant before the United States District Court for the District of Rhode Island (“the Rhode Island District Court”), the Austrian courts were requested under letters rogatory to seize assets which had been found in two safes in Vienna rented by the applicant. On 10 February 1992 the Vienna District Criminal Court ordered the seizure and put the assets, mostly cash and bearer bonds, at the disposal of the Rhode Island District Court as evidence in the criminal proceedings against the applicant, on the condition that the assets were to be returned upon termination of the proceedings. 8. The parties disagree as to whether or not the applicant was the owner of the assets at issue. The applicant claims that the assets stemmed from lawful business activities carried out until 1988, while the Government claim that they stemmed from the money laundering in 1990 and 1991 of which he was convicted (see below) and that he was holding them as a trustee for the drug cartel for which he had worked. 9. In February 1993 the Rhode Island District Court convicted the applicant of money laundering and related charges, finding that he had headed an organisation which had laundered more than a hundred million United States dollars (USD) in 1990 and 1991, and sentenced him to 660 years’ imprisonment. Subsequently, on 30 August 1993, the court issued a preliminary forfeiture order. 10. On 28 June 1995 the United States Court of Appeals, First Circuit, dismissed an appeal by the applicant against his conviction and against the forfeiture order. The reasons, in so far as relevant in the context of the present case, were as follows. As to the applicant’s claim that he was represented at his trial by counsel (H.) who had a conflict of interest, the court noted that the applicant had been informed of his rights but had insisted on being represented by counsel H. Finally, he had executed a written waiver retaining H. as counsel and confirming that he had been fully advised and had considered the possible adverse consequences for his defence. Since counsel H. had only informed the court in vague terms that he feared being charged or called as a witness in the applicant’s case, the District Court was justified in accepting the waiver. In any event, the applicant was represented by a second, conflict-free counsel, D. As to the applicant’s complaint that he had had no hearing in the forfeiture proceedings, the appellate court noted that the applicant, represented by counsel, had waived his right to a jury hearing in the separate forfeiture proceedings on the ground that they purely concerned matters of legal argument. The case had been heard on 26 March 1993 in the presence of the applicant’s counsel. The applicant had not been present since he had to appear before another court. Counsel had requested that the applicant be heard but had refused the court’s offer to have a further hearing in the presence of the applicant before the delivery of the judgment. 11. On 25 March 1996 the United States Supreme Court rejected an appeal on points of law by the applicant. 12. On 7 November 1997 the Rhode Island District Court issued a final forfeiture order relating to a total amount of USD 136 million, including some USD 9 million in respect of the applicant, “being the proceeds of narcotics money laundering for which the following property has been partially substituted”. There followed an enumeration of cash amounts in Swiss francs, United States dollars and Austrian schillings seized in Vienna in 1992 and a list of bearer bonds issued by Austrian banks and, finally a bank account in Vienna. 13. On 9 December 1997 the Rhode Island District Court issued letters rogatory which, so far as relevant, read as follows: “... the United States District Court for the District of Rhode Island requests enforcement in Austria of the enclosed Final Forfeiture Order against said cash, bonds and other financial instruments. To the extent possible under Austrian law and consistent with any sharing agreement between the United States and Austria, please convert the cash and the proceeds of the bonds and other instruments into United States dollars and transfer those funds by wire into the above referenced United States Customs Service Account. ...” 14. The United States Department of Justice transmitted this request to the Austrian authorities on 18 December 1997. On 23 January 1998 the Austrian Ministry of Justice requested the Vienna Senior Public Prosecutor’s Office to open “exequatur” proceedings to enforce the foreign court’s decision. 15. On 12 March 1998 the Vienna Regional Criminal Court (Landesgericht für Strafsachen), as an interim measure, ordered the confiscation of the applicant’s assets, of a total value of about 80,000,000 Austrian schillings (ATS – approximately 5,800,000 euros), in cash, bearer bonds and a bank account, for the purpose of securing the enforcement of the final forfeiture order of 7 November 1997. It referred to the above request and noted that enforcement proceedings under the Extradition and Legal Assistance Act (Auslieferungs- und Rechtshilfegesetz – “the ELAA”) were pending. 16. The applicant appealed on 26 March 1998, submitting in particular that the Regional Court’s decision amounted to an unlawful interference with his right to property, as it lacked a legal basis. Moreover, an enforcement of the forfeiture order for the benefit of the United States was not admissible in Austria as section 64(7) of the ELAA provided that any fines or forfeited assets obtained by executing a foreign decision fell to the Republic of Austria. 17. Further, the applicant claimed that the final forfeiture order also included “substitute assets”, i.e. assets not connected to or derived from criminal activity. Thus the measure requested did not correspond in any way to forfeiture (Verfall) or withdrawal of enrichment (Abschöpfung der Bereicherung) within the meaning of the Austrian Criminal Code (Strafgesetzbuch). In any event these penalties could not be applied in his case, as the relevant provisions had not been in force at the time he committed the offences. Furthermore, he had been convicted of money laundering in the United States, an offence which had not been punishable under Austrian law at the time of its commission. 18. Relying on section 64(1) of the ELAA, the applicant also argued that the forfeiture proceedings had failed to comply with the requirements of Article 6 of the Convention, since the proceedings had not been public and he had not been heard. Moreover, his defence rights had been violated in the underlying criminal proceedings, his defence lawyer having been caught in a conflict of interests. 19. Lastly, the applicant claimed that there was a lack of reciprocity as decisions of Austrian courts were not enforceable in the United States. 20. Meanwhile, on 12 March 1998, the Vienna Regional Criminal Court had made a formal request to the United States authorities to hear the applicant in connection with the request for execution of the final forfeiture order. On 16 April 1998 the United States Department of Justice transmitted the applicant’s submissions to the Austrian Ministry of Justice. 21. On 22 May 1998 the United States Department of Justice addressed a note to the Austrian Ministry of Justice concerning reciprocity in providing legal assistance in forfeiture proceedings. The applicant denies that this note contains assurances of reciprocity. 22. On 1 August 1998 the Treaty between the Government of the Republic of Austria and the Government of the United States of America on Mutual Legal Assistance in Criminal Matters (“the 1998 Treaty”) entered into force. 23. On 12 October 1998 the Vienna Court of Appeal (Oberlandesgericht) dismissed the applicant’s appeal against the Regional Court’s decision of 12 March 1998. 24. The Court of Appeal found that the Regional Court’s decision was based on Article 144a of the Code of Criminal Procedure (Strafprozeßordnung). In this connection, the court noted that pursuant to section 9(1) of the ELAA, the provisions of the Code of Criminal Procedure had to be applied mutatis mutandis unless explicitly provided otherwise. 25. As to the applicant’s assertion that a forfeiture for the benefit of the United States would be contrary to section 64(7) of the ELAA, the court observed that the letters rogatory requested first and foremost that any measures required under Austrian law for the execution of the final forfeiture order be taken. Only as an additional point did they ask for the transfer of the assets, provided that this was admissible under Austrian law or any bilateral treaty. In this connection it referred to Article 17(3) of the 1998 Treaty. 26. As regards the applicant’s assertion that the final forfeiture order covered substitute assets which could not be subject to forfeiture under Austrian law, the court observed that it followed from the judgment concerning the applicant’s conviction that he had led an organisation which had laundered large sums of money derived from drug dealing and had usually received a 10% commission for each amount laundered. Between 1 January 1990 and 2 April 1991 he had transferred more than USD 136 million of drug-related money from the account of a sham company to various foreign bank accounts. Thus, there were good reasons to assume that the applicant’s Austrian assets were monies received for or derived from the commission of a crime and subject to withdrawal of enrichment under Article 20 of the Criminal Code, or monies directly obtained through drug dealing, subject to forfeiture under Article 20b of the Criminal Code, in the version in force since its 1996 amendment. The final forfeiture order made a clear link between the offence of money laundering of which the applicant had been convicted and the forfeiture of all monies obtained thereby. 27. Articles 20 and 20b in the version in force since the 1996 amendment of the Criminal Code were not regarded as penalties under Austrian law, but as measures sui generis. The fact that they had not been in force at the time of the commission of the offences was therefore not material. 28. Even if one applied the law in force at the time of the commission of the offences, the requirements for withdrawal of enrichment were met. Article 20a(1) of the Criminal Code, in the version in force at that time, provided that an offender who had unjustly enriched himself could be ordered to pay an amount equivalent to the enrichment if the latter exceeded ATS 1 million. Although there had been no offence of money laundering under Austrian law at the time, the facts constituted the offence of receiving stolen property (Hehlerei) under Article 164(1)(4) of the Criminal Code, which made it an offence to assist the perpetrator of an offence (here, the drug dealers) in concealing assets derived from or received for the commission of the offence or to acquire such assets. 29. As to the applicant’s allegation that both the criminal proceedings against him and the proceedings resulting in the final forfeiture order had failed to comply with Article 6 of the Convention, the court referred to the documents of those proceedings contained in its file and noted the following. In the criminal proceedings, the applicant had been present and had been represented by two counsel. It noted that it was the applicant who had insisted on being represented by counsel H. although the latter had voiced concerns, albeit without substantiating them, that he might himself be charged. In any case, the applicant had been represented by a second counsel, who was free from any potential conflict of interests. In the forfeiture proceedings he waived his right to a public hearing before a jury since they only concerned questions of law. On 26 March 1993 the judge had heard the case in the presence of the applicant’s counsel but without the applicant being present. The applicant’s lawyer had requested that the applicant be heard but had refused the court’s offer to hold a further hearing in the presence of the applicant before the delivery of the judgment. In sum, the Vienna Court of Appeal found no indication that the proceedings before the United States courts had failed to comply with Article 6 of the Convention. 30. As regards the alleged lack of reciprocity, the court noted that when the request for enforcement of the final forfeiture order had been made, there had been no bilateral treaty between the United States and the Republic of Austria. Thus, only the provisions of the ELAA had to be applied, section 3(1) of which required reciprocity. The Regional Court had duly investigated the issue in that it had required the United States Department of Justice to submit information as to the possibilities of enforcing an Austrian forfeiture order in the United States. Meanwhile, however, the 1998 Treaty had entered into force. Under Article 20(3) of that Treaty, it applied irrespective of whether the underlying offences were committed before or after its entry into force. Article 17 provided for mutual legal assistance in forfeiture proceedings. 31. On 25 August 1999 the United States central authority, relying on the 1998 Treaty, made a new request for enforcement of the final forfeiture order of 7 November 1997. According to the applicant, this second request for legal assistance was not served on him. 32. The applicant made submissions on 22 December 1998, on 11 March 1999 and on 11 May 2000. 33. On 14 June 2000 the Vienna Regional Criminal Court, without holding a hearing, decided to take over the enforcement of the final forfeiture order of 7 November 1997 and ordered the forfeiture of the applicant’s Austrian assets for the benefit of the United States. 34. Having regard to the 1998 Treaty, the requirement of reciprocity was fulfilled. The submissions by the applicant which disputed this were no longer relevant as they referred to the legal position before the entry into force of the 1998 Treaty. As to the question of the beneficiary of the forfeiture, it noted that Article 17(3) of the 1998 Treaty provided optionally that each State party could hand over forfeited assets to the other party. 35. Referring to the Court of Appeal’s decision of 12 October 1998, it noted that the applicant’s conduct had been punishable under Austrian law. Thus, the forfeiture was not contrary to Article 7 of the Convention. Finally, the court noted that the applicant had been given an opportunity to comment on the request for legal assistance. 36. The applicant appealed on 7 July 2000. He asserted that the 1998 Treaty provided for legal assistance in pending criminal proceedings, but did not contain a legal basis for mutual execution of final decisions. Even assuming that the 1998 Treaty applied in the present case, the enforcement of the final forfeiture order would violate Article 7 of the Convention as the said Treaty had not been in force in 1997 when the forfeiture order was issued. Moreover, money laundering had not been punishable under Austrian law at the time of the commission of the offences. Consequently, his assets could not be subject to forfeiture or withdrawal of enrichment under Austrian law. 37. Furthermore, the applicant repeated his argument that his Austrian assets were substitute assets and claimed that, at the time of the commission of the offences, such assets had not been subject to forfeiture or withdrawal of enrichment under Austrian law. 38. Relying on expert opinions submitted by him, the applicant maintained that the condition of reciprocity required by section 3(1) of the ELAA was not fulfilled, as United States constitutional law did not permit the enforcement of decisions given by foreign criminal courts. He further submitted that the five-year limitation period for enforcement had started running on 30 August 1993, when the preliminary forfeiture order was issued (as it was, despite its name, a final and enforceable decision), and not only on 7 November 1997, when the final forfeiture order was issued. 39. In addition the applicant alleged that the criminal proceedings and the forfeiture proceedings before the United States courts had not complied with the requirements of Article 6 of the Convention. He submitted the same arguments as in the proceedings relating to the preliminary confiscation of his assets. Moreover, he referred in general terms to the fact that the United States still applied the death penalty. 40. The applicant also complained about a number of procedural shortcomings as regards the proceedings in Austria. He alleged in particular that the Regional Court had refused to take into account the aforesaid expert opinions submitted by him, which showed that United States constitutional law excluded any enforcement of decisions of foreign criminal courts. Moreover, he had not been given sufficient opportunity to advance his arguments as, in his view, that would have required his personal presence in court. Finally, he complained that the Regional Court had failed to hold a public oral hearing and requested that such a hearing be held by the appellate court. 41. The Public Prosecutor’s Office also appealed. Its appeal was served on the applicant for comments, which he submitted on 21 September 2000. 42. On 7 October 2000 the Vienna Court of Appeal, sitting in camera, dismissed the applicant’s appeal. Upon the public prosecutor’s appeal, it amended the Regional Court’s decision and ordered the forfeiture to the benefit of the Republic of Austria. 43. The court noted at the outset that, pursuant to its Article 20(3), the 1998 Treaty applied irrespective of whether the underlying offences were committed before or after its entry into force. It dismissed the applicant’s argument that the said Treaty did not provide a basis for the mutual enforcement of decisions. Article 1, paragraphs (1) and (2)(h) of the Treaty, in conjunction with Article 17, governed legal assistance in forfeiture proceedings. As to the alleged lack of reciprocity, it was sufficient to refer to those provisions. It was therefore not necessary to examine questions of United States constitutional law. 44. Moreover, referring to its decision of 12 October 1998, the court reiterated that the facts underlying the applicant’s conviction for money laundering would have been punishable as receiving stolen property under Article 164(1)(4) of the Criminal Code at the time of the commission of the offences. Further, it reiterated that withdrawal of enrichment pursuant to Article 20 of the Criminal Code and forfeiture pursuant to Article 20b, both in the version in force since 1996, were not regarded as penalties, but served the purpose of neutralising proceeds of criminal activities. These measures covered any proceeds of an offence, irrespective of whether they were directly derived from the offence or given for its commission or whether they had already been converted into other assets. 45. With regard to the applicant’s complaint that the proceedings in the United States had not complied with the requirements of Article 6 of the Convention, the court referred to the reasons given in its previous decision of 12 October 1998. 46. The court dismissed the applicant’s plea that the enforcement of the final forfeiture order was time-barred, noting that the United States Supreme Court, on 25 March 1996, had refused leave to appeal against the provisional forfeiture order, whereupon the final forfeiture order had been issued on 7 November 1997. Consequently, the five-year limitation period pursuant to section 59 of the Criminal Code had not expired. 47. As to the applicant’s procedural rights, the court noted that he had been represented by counsel throughout the proceedings and had had the opportunity to submit extensive written pleadings. 48. Finally, the court considered that the public prosecutor’s appeal was well-founded in that section 64(7) of the ELAA provided that forfeited assets fell to the Republic of Austria. Thus, forfeiture to the benefit of the United States under Article 17(3) of the 1998 Treaty was not admissible. 49. The decision was served on the applicant on 30 October 2000. 50. Section 1 of the Extradition and Legal Assistance Act (Auslieferungs- und Rechtshilfegesetz, Federal Law Gazette no. 529/1979) provides that the Act applies where international or bilateral agreements do not provide otherwise. 51. Section 3 carries the heading “reciprocity” and, so far as relevant, provides as follows: “(1) Foreign requests may be granted only if it is ensured that the requesting State would also grant an equivalent Austrian request. ... (3) If there are doubts regarding compliance with reciprocity, information shall be obtained from the Federal Minister of Justice.” 52. Section 64 is situated in the chapter on the enforcement of decisions by foreign criminal courts. It regulates the conditions for taking over the enforcement of such decisions. “(1) Enforcement or further enforcement of a decision by a foreign court with final and legal effect, in the form of a monetary fine or prison sentence, a preventive measure or a pecuniary measure (vermögensrechtliche Anordnung), is admissible at the request of another State if: 1. the decision of the foreign court was taken in the course of proceedings in compliance with the principles of Article 6 of the European Convention for the Protection of Human Rights and Fundamental Freedoms (the Convention) (Federal Law Gazette no. 210/1958); 2. the decision was taken in relation to an act that is punished by a court sentence under Austrian law; 3. the decision was not taken in relation to one of the offences listed in sections 14 and 15; 4. no time-limit has expired under Austrian law regarding enforceability; 5. the person concerned by the decision of the foreign court regarding this offence is not being prosecuted in Austria, has been finally and effectively convicted or acquitted in this matter or has otherwise been released from prosecution. ... (4) Enforcement of a decision by a foreign court which results in pecuniary measures is admissible only to the extent that the requirements under Austrian law for a monetary fine, a withdrawal of enrichment or forfeiture apply, and that no corresponding Austrian measure has yet been taken. ... (7) Fines, forfeited assets or enrichment withdrawn shall fall to the Republic of Austria.” 53. The procedure to be followed in cases concerning the enforcement of foreign decisions is laid down in section 67 of the ELAA. It does not make any provision for the holding of hearings. 54. The Treaty was signed on 23 February 1995 and, following ratification, entered into force on 1 August 1998 (Federal Law Gazette Part III, no. 107/1998). “(1) The Contracting Parties shall provide mutual assistance, in accordance with the provisions of this Treaty, in connection with the investigation and prosecution of offences, the punishment of which at the time of the request for assistance would fall within the jurisdiction of the judicial authorities of the Requesting State, and in related forfeiture proceedings. (2) Assistance shall include: ... (h) assisting in proceedings related to forfeiture and restitution; ...” “(1) If the Central Authority of one Contracting Party becomes aware of fruits or instrumentalities of offences which are located in the territory of the other Party and may be forfeitable or otherwise subject to seizure under the laws of that Party, it may so inform the Central Authority of the other Party. If the other Party has jurisdiction in this regard, it may present this information to its authorities for a determination as to whether any action is appropriate. These authorities shall issue their decision and shall, through their Central Authority, report to the other Party on the action taken. (2) The Contracting Parties shall assist each other to the extent permitted by their respective laws in proceedings relating to the forfeiture of the fruits and instrumentalities of offences, restitution to the victims of crime, and the collection of fines imposed as sentences in criminal prosecutions. (3) A Requested State in control of forfeited proceeds or instrumentalities shall dispose of them in accordance with its law. To the extent permitted by its laws and upon such terms as it deems appropriate, either Party may transfer forfeited assets or the proceeds of their sale to the other Party.” “(3) This Treaty shall apply to requests whether or not the relevant offences occurred prior to the entry into force of this Treaty.”