Special confiscation and extended confiscation in economic criminal cases: how to protect your assets and bank accounts

• what special confiscation and extended confiscation mean in legal terms;
• what the conditions for their application are in economic criminal cases;
• what the role of ANABI (the National Agency for the Management of Seized Assets) is;
• what concrete effects these measures have on your assets;
• what defence strategies you can discuss with your lawyer to limit losses;
• what practical aspects entrepreneurs and individuals should keep in mind.

You will also find links to other useful articles on this website (in Romanian), including:

• pre-trial detention – how you can be detained and what rights you have (RO) ;
• house arrest – conditions, duration, restrictions and differences compared to pre-trial detention (RO) ;
• how long a criminal case can take, from investigation to appeal (RO) ;
• criminal defence services page (RO): Criminal law services – Attorney Alexandru Măglaș .

1. Legal framework: where do we find the rules on confiscation?

Special confiscation and extended confiscation are regulated mainly in the Criminal Code, the Criminal Procedure Code and Law no. 318/2015 on ANABI, but they are also shaped by EU standards:

• Criminal Code – Law no. 286/2009 on the Criminal Code (Romanian) :
  • Article 112 – special confiscation (RO) ;
  • Article 112¹ – extended confiscation (RO) .
• Criminal Procedure Code – Law no. 135/2010 on the Criminal Procedure Code (Romanian) :
  • provisions on precautionary measures (seizure) – Articles 249–254 CPC;
  • Article 250 CPC – challenge against precautionary measures (RO) ;
  • Article 250² CPC – periodic review of precautionary measures.
• Law no. 318/2015 on the establishment, organisation and functioning of ANABI – full text (RO) .
• Directive 2014/42/EU of the European Parliament and of the Council on the freezing and confiscation of instrumentalities and proceeds of crime in the European Union – transposed into national law and directly influencing the regime of extended confiscation.

In addition, the Constitutional Court and the High Court of Cassation and Justice have delivered numerous decisions on the constitutionality and conditions of application of special and extended confiscation, while ECtHR case-law sets the boundaries within which such measures are compatible with the right to property and the presumption of innocence.

2. Special confiscation: definition and practical examples

2.1. What is special confiscation?

Special confiscation is a security measure by which the State transfers into its own assets certain goods directly linked to a criminal offence. It is not a “fine” in the usual sense, but a measure targeting goods that are considered dangerous or unlawful in relation to the offence.

Article 112 of the Criminal Code provides, in essence, that the following can be confiscated:

• goods produced by the commission of an offence;
• goods used or intended to be used for committing the offence;
• goods given to induce or reward the perpetrator;
• goods acquired through the offence, insofar as they are not returned to the injured party and are not used to cover the damage;
• goods whose possession is prohibited by criminal law.

If such goods can no longer be found (they have been sold, hidden, consumed, transferred abroad etc.), the court may order confiscation by equivalent, i.e. ordering the person to pay a sum of money corresponding to the value of the goods.

2.2. Special confiscation in economic criminal cases

In economic criminal cases, special confiscation usually targets:

• amounts of money obtained by non-payment of taxes (tax evasion), EU funds fraud, fraud, embezzlement;
• bank accounts where the proceeds of crime have been transferred or “cycled”;
• real estate directly purchased with illicit funds or pledged in fraudulent operations;
• vehicles or other movable assets bought with illicit money;
• shares or equity participations in companies through which funds are moved;
• equipment, IT systems, software and other assets used to commit the offence (for example, for document forgery or computer fraud schemes).

As a rule, special confiscation is ordered together with the criminal judgment – conviction, postponement of the application of the sentence or waiver of the application of the sentence – but can also intervene in other forms, depending on the particular situations regulated by the Criminal Code.

2.3. Confiscation by equivalent and third-party assets

A key practical problem is that assets acquired through crime often cannot be found anymore. For example, the money has been spent, the property has been sold on, the vehicle has been deregistered or exported. In such situations, the court may:

• order confiscation by equivalent – obliging the defendant to pay a sum of money corresponding to the value of the assets;
• confiscate assets transferred to third parties, if it is proven that they knew of the illicit origin or the purpose of the transfer, or that the assets are used only to avoid confiscation.

For third parties (spouse, children, relatives, friends, business partners), it is essential to demonstrate that they are bona fide acquirers, that they actually paid the purchase price and that they had no reason to suspect the illicit origin. In the absence of such proof, the asset may be confiscated, even if they are not defendants in the criminal case.

3. Extended confiscation: when can the State go “beyond” the specific offence?

3.1. The core idea behind extended confiscation

Extended confiscation is a relatively new institution in Romanian criminal law, introduced to meet EU demands on asset recovery. Its core idea is the following:

If a person is convicted for certain serious offences, and the court finds a major disproportion between their lawful income and the value of assets acquired during a certain period, the authorities can confiscate assets that cannot be directly linked, euro by euro, to the specific offence.

Article 112¹ of the Criminal Code provides that the court may confiscate “other assets than those referred to in Article 112”, where, on the basis of sufficient indicia, it is convinced that they originate from criminal activities.

3.2. Conditions for extended confiscation

In simplified terms, several cumulative conditions must usually be met:

• there is a conviction for an offence included in the list provided by the Criminal Code or special law (typically serious crimes: corruption, serious tax evasion, money laundering, drug trafficking, organised crime, offences against the EU’s financial interests, etc.);
• the offence is punishable by a maximum sentence of at least 4 years’ imprisonment (a criterion used to delimit serious offences);
• there is an obvious disproportion between the value of the assets acquired by the convicted person during a given period (for example, 5 years before and after the offence) and their lawful income;
• there are concrete elements indicating that the assets derive from criminal activities, not just general suspicions or subjective impressions.

Extended confiscation may also target assets transferred to third parties, if it is shown that they knew or should have known that the transfer pursued the avoidance of confiscation or the concealment of the illicit origin.

3.3. Why extended confiscation is so important in economic criminal cases

In complex economic and financial cases, particularly those involving organised crime, continuous tax evasion or money laundering, it is extremely difficult to demonstrate, for each individual asset, a direct link to a given transaction or act.

Extended confiscation allows the court to look at the entire picture: lifestyle, investments, properties, bank accounts, cars, assets in Romania and abroad, comparing them with declared income (salaries, dividends, rent, other lawful sources). If the discrepancy is obvious and there are no credible explanations, the “surplus” assets may be confiscated.

This is why defence strategy is crucial: proving the lawful origin of assets, explaining financial flows, presenting accounting and tax documents and the economic logic of transactions.

4. Precautionary measures and ANABI’s role: from seizure to disposal

4.1. Seizure – “freezing” the assets

Before any actual confiscation, prosecutors and courts will normally impose precautionary measures, regulated by Articles 249–254 of the Criminal Procedure Code. Through these measures, assets are frozen (seizure), to prevent their concealment, destruction or transfer.

Seizure may cover:

• bank accounts (blocking funds up to a certain amount);
• real estate (noting the seizure in the land register);
• vehicles and other movable assets of significant value;
• shares, equity participations, securities;
• any other assets that may be subject to special or extended confiscation.

The Criminal Procedure Code provides that, in the case of assets that may be subject to special or extended confiscation, precautionary measures are mandatory, not merely optional, precisely to ensure that, at the end of the trial, the State or the injured party has assets to recover from.

4.2. Challenging precautionary measures

The prosecutor’s order or the court ruling imposing seizure can be challenged through a complaint (contestație), under Articles 250 and 250¹ CPC. The time-limit is generally 3 days from the date of service or from the date on which the measure is enforced.

The complaint does not usually suspend the seizure, but it allows the court to verify:

• whether the legal conditions for the measure are met;
• whether there are sufficient indicia that the assets are connected with the offence;
• whether there is a reasonable proportion between the value of the frozen assets and the alleged damage or the sums that may be subject to confiscation.

In addition, the court must periodically review whether the grounds for maintaining the seizure still exist (Article 250² CPC). In cases of excessive passivity by the authorities, the court may decide to lift or reduce the seizure.

4.3. ANABI’s role in managing and disposing of seized assets

ANABI – the National Agency for the Management of Seized Assets – is the public authority established by Law no. 318/2015 to support the tracing, management and disposal of assets seized or confiscated in criminal proceedings.

ANABI’s main responsibilities include:

• keeping records of movable and immovable assets frozen in criminal cases;
• managing assets (for example, storing vehicles, renting out real estate, preserving value);
• early sale (pre-sale) of seized assets, under the law, when keeping them in kind would lead to substantial loss of value or excessive maintenance costs;
• publishing lists of seized and confiscated assets and organising public auctions;
• proposing Government decisions for the social reuse of certain confiscated properties (for example, for public institutions or social projects).

For the person targeted by the criminal case, this means, in practice, that a seized asset may be sold before the end of the trial. If confiscation is ultimately ordered, the money will go towards confiscation or damage recovery; if the person is acquitted and no confiscation is ordered, they are generally entitled to the value obtained, not necessarily to the return of the asset itself. This is another reason why it is important to understand the risks early and to plan a defence accordingly.

5. The impact of confiscation on your assets: what do you actually risk?

5.1. Bank accounts and liquidity

In economic criminal cases, the first reflex of the authorities is often to freeze bank accounts – both personal and those of companies where you act as shareholder or director. This can completely paralyse business activity and put at risk payment of salaries, suppliers or bank loans.

A sound defence strategy must aim, from the investigation phase, at:

• reducing the seizure to the amount strictly necessary to cover the alleged damage and possible confiscation;
• presenting clear arguments regarding the lawful origin of certain sums (for example, salaries, dividends, sales of lawful assets, bank loans);
• separating, as far as possible, business cash flows from personal accounts, so that seizure is better delimited and justified.

5.2. Real estate, vehicles, shares in companies

Confiscation or seizure may affect:

• your home or other properties (apartments, land, commercial premises);
• vehicles, machinery, technical equipment;
• shares or equity participations in companies.

If the property is jointly owned with your spouse (legal community property), the court will normally consider confiscation only of the share belonging to the convicted person, while the spouse’s share should be protected. In practice, however, things can become complicated if there are suspicions that the property was placed in the spouse’s or other relatives’ name merely to avoid confiscation.

As far as company shares are concerned, the State can effectively become a shareholder through confiscation, with direct impact on control and management. In other situations, confiscation by equivalent may be ordered, based on a valuation of the shareholding.

5.3. Assets belonging to relatives and third parties

Special confiscation and particularly extended confiscation can affect assets owned by relatives and third parties, if it is shown that these assets were used to conceal criminal proceeds or to avoid confiscation.

For example:

• properties placed in parents’ or adult children’s names without a genuine consideration;
• cars, boats, machinery apparently purchased by relatives but used exclusively by the suspect;
• large transfers of money to friends or business partners with no economic justification.

To confiscate these assets, the authorities must still prove that the third parties knew or should have known the real purpose of the transfer. Therefore, third parties may have an interest in intervening in the proceedings and asserting their property rights.

6. Defence strategies: how can you protect your assets and accounts?

6.1. Proving the lawful origin of assets

In any economic case with a risk of extended confiscation, one of the main lines of defence is proving the lawful origin of assets. In practice, this means being able to link each significant asset to:

• employment contracts and payslips;
• service contracts, invoices, consultancy agreements;
• sale and purchase contracts, donation deeds, inheritance documents;
• loan agreements and documents showing the use of borrowed funds;
• asset declarations (where applicable), balance sheets, financial statements, bank statements.

The absence of documents does not automatically mean that an asset is illicit, but it makes your position much weaker. In practice, courts may treat an unexplained disproportion between wealth and declared income as a serious indicium in favour of extended confiscation.

6.2. Challenging seizure and adjusting its scope

If your bank accounts, properties or other assets are seized, discuss with your lawyer whether it is appropriate to:

• file a complaint against the seizure (within the 3-day time-limit) where the substantive conditions are not met;
• request a reduction of the seizure, where the value of frozen assets is excessively high in relation to the alleged damage or potential confiscation;
• request an substitution of a seized asset by another (for example, replacing a family home with a different asset), in order to protect essential property for the family or for the functioning of a viable business.

The arguments must be carefully built, with figures, valuations and accounting documents, not just general statements that “the seizure is too broad”.

6.3. Challenging the link between assets and the offence

For both special and extended confiscation, the link between assets and criminal activity is crucial. Defence work can include:

• showing that the assets were owned before the relevant period for the case (for example, acquired many years prior to the alleged offences);
• demonstrating an alternative lawful origin (inheritance, donations, gains from previous lawful business, long-term savings);
• in the case of third parties, showing that the transaction was real and for consideration (price actually paid, genuine use of the asset by the third party, not just a formal transfer).

Without such a defence, the court may consider that the indicia brought by the prosecution are sufficient to justify confiscation, particularly in serious economic cases.

6.4. Using case-law and ECtHR standards

Although confiscation is a legitimate tool in the fight against economic crime, it is not unlimited. The European Court of Human Rights and domestic courts have underlined that:

• the scope of the law must be respected, without abusive extension;
• the principle of proportionality must be observed – the measure must not be excessive in relation to the offence;
• the rights of bona fide third parties who did not participate in the offence and did not know of the illicit origin of assets must be protected.

In your defence, your lawyer can invoke relevant ECtHR judgments and Romanian Constitutional Court or High Court decisions to argue that, in your particular circumstances, confiscation would go beyond what is allowed by the Constitution and the Convention.

7. Practical aspects for entrepreneurs and individuals

7.1. How to prepare if you operate in a high-risk sector

If you are an entrepreneur in a sector with a high criminal risk (construction, trade in excisable goods, cash-based services, import-export, EU-funded projects, public procurement), it is prudent to plan ahead:

• rigorous documentation of all financial flows – contracts, invoices, payment orders, commercial correspondence;
• clear separation between personal accounts and business accounts, to limit the impact of any investigation;
• avoiding the use of other people’s accounts or assets to “park” money or property – such short-term “solutions” can significantly increase the risk of extended confiscation;
• regular consultation with a criminal defence lawyer specialising in economic crime, not only with your accountant or tax consultant.

7.2. What to do if you learn you are under investigation and confiscation is on the table

If you find out that you are a suspect or defendant in an economic criminal case and there is talk of seizure and confiscation:

• do not make “instinctive” moves (such as “I’ll immediately transfer the house to someone else”); such steps can be interpreted as attempts to evade confiscation and may aggravate your situation;
• immediately gather all documents that can show the lawful origin of assets (contracts, statements, receipts, asset declarations, etc.);
• discuss with your lawyer a long-term strategy, not just short-term reactions to investigative measures;
• properly inform family members who may be affected (spouse, parents, adult children), so that they can, where appropriate, assert their own property rights.

7.3. Relationship with banks and other creditors

Seizure and potential confiscation raise issues in relation to banks and other creditors (leasing companies, key suppliers). In some cases, these creditors have their own guarantees (mortgages, pledges), and their rights must be reconciled with confiscation.

In practice, situations can arise where:

• the State and the bank both seek recovery from the same asset (for example, a mortgaged property);
• assets are sold at auction and the sale price has to be distributed to secured creditors, the injured party, and possibly to cover confiscation and court costs.

This is why, in high-value cases, a coordinated approach is needed between criminal defence counsel, lawyers specialised in civil/commercial law and, sometimes, tax or restructuring advisers.

8. Conclusions: when does it make sense to fight confiscation?

Special confiscation and extended confiscation are powerful tools in the hands of the State in economic criminal cases. For the person under investigation, the stake is existential: their own and their family’s assets.

In essence, it is worth fighting such measures when:

• there are strong arguments regarding the lawful origin of assets or the fact that the alleged disproportion between wealth and income is exaggerated or illusory;
• the measure is excessive in relation to the alleged damage or the actual gravity of the offence;
• essential assets for family life (the home, the main source of income, the assets of a viable business) are disproportionately affected;
• bona fide third-party assets are targeted, although they have no real link to the offence.

On the other hand, in some cases a realistic strategy may include partial acknowledgement that certain assets have an illicit character, concentrating the dispute on essential property or on reducing the scope of extended confiscation.

Every economic criminal case is, in the end, a balance between penal risk (loss of liberty) and asset risk (confiscation). This is why you need a lawyer who can see the big picture: not just the sentence, but also the protection – as far as the law allows – of your assets and your family’s assets.