ICC Commercial Crime Service

The People’s Money $£¥

ICC FraudNet members talk fraud and the job of working for victims in the world ofcomplex fraud, asset tracing and asset recovery.

The biggest misconception people have about complex fraud is:

That they can report it to governmental criminal authorities and that these authorities will get them back the money they lost through fraud. This almost never happens, and the process – which victims find out eventually but often too late – allows the passage of time for the funds and other assets to be more effectively hidden. This is not meant to be critical of governmental criminal authorities. They have a job to do – which is to fight crime – and depending on where you are in the world – they do a great job fighting crime with limited resources and often with the deck stacked against them. However, governments are simply not equipped to provide effective, consistent and meaningful assistance with asset recovery for victims of fraud.

The biggest misconception government officials have about complex fraud is:

That government to government mutual legal assistance and/or forfeiture are viable solutions to combat complex fraud and to assist victims of that fraud. While MLATS can be useful – particularly in corruption cases – they are generally not available to assist in most frauds, and in many cases the criminal conduct involved will not be enough to move a requested government to help with the kind of dedication necessary to beat a determined fraudster.

The greatest challenges in asset tracing and recovery in my part of the world are:

The lack of funding to prosecute the cases in a manner that increases the chances of success for the victim. Many cases are never investigated and are never brought, because the victim or victims have already been defrauded out of so much they simply can’t finance the legal, investigative and forensic resources necessary to prevail in an asset recovery case. Fortunately, solutions are starting to emerge. More clients are opening their minds to using contingency fees or partial contingency fee structures, and litigation funders are now funding asset recovery cases.

The greatest challenges worldwide are:

In my opinion, two of the greatest challenges faced in asset recovery are Courts that treat asset recovery cases as a typical litigation case and the lack of effective rules of law in many money haven countries. One of the biggest issues is that Courts do not see the level of urgency that must be brought to an asset recovery case, and treat the fraudster as a typical litigant with all the presumptions of good faith and good intentions any litigant is accorded. Fraudsters are masters at playing the system and can often stretch out the legal process to “play out the clock” on the victim with legal resources. As well, one issue is that the rule of law is weak in many countries – but certainly not all – where fraudsters either live or they seek to hide their assets. Therefore a strategy must be deployed to account for that challenge by focusing on jurisdictions where the fraudster has assets and the rule of law is strong.

What I tell victims of fraud about the process of asset tracing and recovery is:

You have to be patient. It is a form of hunting. You have to stalk the prey carefully and only deploy the strategy at just the right moment. Asset recovery is a process that can take significant time and money to obtain a successful conclusion as you are usually fighting a totally unscrupulous foe who is determined, does not play by the rules of society and is well financed. There are very few easy asset recovery cases and the process can often take years. However, perseverance almost always wins. The hunter that hunts the smartest and the longest almost always fills his game bag.

The most challenging day I’ve faced on a case was:

Finding out that information we had received from an investigator was not accurate, undermining the entire case strategy. Unfortunately it happens to the best asset recovery professionals. All asset recovery professionals try to work with the best investigators, but at times – usually because a client has a previous relationship with the investigator that predates engagement of counsel – an investigator has either been duped or is defrauded by one of his own sources (or commits outright fraud) which undermines the case strategy. It is a hard thing to explain to a client. It means starting over oftentimes.

The best day I’ve ever had working on a fraud case was:

The day that we found out that our team’s case strategy resulted in freezing $98 million against a $95 million judgment. These types of victories are few and far between, and must be savored when they occur. This past spring I was recognized by Who’s Who Legal as the Asset Recovery Lawyer of the Year for the third year in a row, and more importantly my firm was recognized as Asset Recovery Firm of the Year.

I became a member of ICC FraudNet because:

I started to develop a practice as a “fraud lawyer” in 1998. At that time there was no professional organization that a lawyer specializing in representing victims – what became known as an asset recovery lawyer – could join. I became a Certified Fraud Examiner and received great training, but it was still an organization dominated by accountants. I really wanted to be part of a collegial legal organization that focused its efforts on representing victims of fraud and corruption. In early 2004, I was invited to become one of the original members of ICC FraudNet. I accepted immediately, but I could not make the first meeting in London, because my wife and I were on vacation in Ireland. It is the only meeting I have ever missed. I joined ICC FraudNet, because it was a fresh new concept that focused on a new and developing area of practice – asset recovery -- and it has been the most rewarding professional association I have ever had the privilege to join.

Asset tracing and recovery is a chosen part of my work because:

While frustrating at times it is very gratifying and liberating to know that you are working on the side of the victim. Not every lawyer can get up in the morning and know that no matter how challenging the day is, they will be representing the “good guys.” That makes the practice so much more rewarding.

Edward H. Davis, Jr. has practiced law for 28 years, and is a founding shareholder of the Miami international law firm, Astigarraga Davis. As a Certified Fraud Examiner, he heads the firm's Asset Recovery and Financial Fraud group, representing victims of fraud and grand corruption including governments, governmental entities, corporations, hedge funds, insolvency practitioners and individuals by investigating and prosecuting civil fraud and asset recovery actions. He serves as inaugural chair of the International Bar Association’s Anti-Corruption Committee’s Subcommittee on Asset Recovery, and is a leading original member of the London-based International Chamber of Commerce Commercial Crimes Services FraudNet Network. In 2013 Ed was recognized as the first Asset Recovery Lawyer of the Year by Who’s Who Legal. He won that award again in 2014 and 2015.

ICC FraudNet is an international network of independent lawyers, who are leading civil asset recovery specialists in each country. Recognized by Chambers Global as the world’s leading asset recovery legal network, our membership extends to every continent and the world’s major economies, as well as leading offshore wealth havens that have complex bank secrecy laws and institutions where the proceeds of fraud often are hidden. Founded in 2004 by the Paris-based International Chamber of Commerce (ICC), the world’s business organization, FraudNet operates under the auspices of the ICC’s London-based Commercial Crime Services unit.