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Seizure of cryptocurrency in Polish criminal law

The use of cryptocurrencies for commercial transactions is becoming more and more popular, which also results in criminal law cases, in which the theme of cryptocurrencies in various ways is increasingly common.

Virtual currencies are most often used for the crimes of money laundering, terrorist financing or fraud.

In the course of criminal proceedings, virtual currencies can constitute evidence, a trace, a document, information, as well as an object of property security or bail.

Freezing / seizure of assets in Poland

In Polish criminal law property security is a coercive measure, which is not a preventive measure, the purpose of which is to secure the execution of a decision that will be made in the future in connection with a crime for which a fine or monetary benefit may be imposed, or in connection with which a forfeiture or compensatory measure may be imposed.

Although it is not a statutory condition for the use of this institution, in practice it is also often used when there is a risk of the suspect disposing of funds, which in the case of cryptocurrencies is usually possible extremely quickly.

For law enforcement agencies in Poland, property security is one of the most important ways to combat the crime of money laundering (AML regulation).

Freezing / seizure of crypto in Poland

Cryptocurrencies can be subject to blocking / property security just like bank account freezing. A decision on this subject is issued by the court or prosecutor and includes an indication of:

– what the case concerns,

– the amount up to which the security is to take place,

– the method of security.

How crypto blockage is enforced?

Such a decision is immediately enforceable, and the funds are transferred immediately to the account of the law enforcement agency in virtual currency.

If the suspect holds cryptocurrencies on an online exchange, such as Binance then first the authority directs the exchange to demand the release of the object of security, which is usually done efficiently and quickly.

Description of seized crypt?

The authority’s description of the security method consists in including in the sentence of the decision the name and address of the wallet in which the cryptocurrencies were deposited (e.g. 2JVrmSc7gnPR3dKx VXPkNt5cSoCMFvgfz3).

Practice shows that cryptocurrency wallets are often seized in their entirety due to at least intense currency fluctuations.

Summary – seizure of crypto in Poland

Often the freezing of funds in cryptocurrency accounts comes as a big surprise and is often preceded by a law enforcement blockade of the account.

It also happens that these funds are seized from individuals with no connection to the crime, whose account, however, was found as one of the links in a suspicious chain of transactions indicating money laundering.

Polish law enforcement agencies now have mechanisms to technically block the account of virtual currencies and deposit these funds under their supervision.

Since virtual currencies belong to the category of property, and property security results in interference with the right to property, it is necessary to undertake an effective and methodical defense in the course of criminal proceedings.

Any information regarding the issue described above can be explained by our criminal law lawyers.

Author team leader DKP Legal
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