Funds in a bank account do not have the characteristics of material evidence – an important resolution of the Supreme Court

On October 13, 2021, the Supreme Court, responding to the legal issues referred to it, adopted a resolution on the questionable interpretation of Article 86 of the Act of March 1, 2018 on the prevention of money laundering and financing of terrorism (I KZP 1/21).

Article 86 of this act allows the public prosecutor to suspend transactions or block the account of an obliged institution for up to 6 months, in the event of a notice of suspicion of a money laundering or terrorist financing offence.

Under the act, it is also the prosecutor who decides on the scope, manner and timing of the suspension of transactions or the blocking of the account.

This provision raised a number of doubts, in particular in connection with lengthy pre-trial proceedings, as well as the risk that the suspension of transactions or blocking of accounts will last much longer than the statutory 6 months.

The Supreme Court, in its resolution of 13 October 2021, in the case ref. no. I KZP 1/21, determined that the provision of Article 86, paragraph 13 of the Act of 1 March 2018 on prevention of money laundering and financing of terrorism must be interpreted strictly and taking into account the guarantee function of this provision.

In the opinion of the Supreme Court, the funds accumulated in the bank account also do not have the characteristics of material evidence within the meaning of the said provision, since they do not exist as things, but are only records in the computer system.

This, in consequence, leads to the conclusion that the prosecutor's treatment of funds accumulated in a bank account as evidence, even if the intention is to secure them against loss in case they are released to the bank account holder, is an action without legal basis.

As emphasized in the Court’s resolution, treating funds in a bank account as evidence would allow the prosecutor to carry out activities in the case for a long time (beyond the statutory 6 months), without formally instituting proceedings against the account holder or the party to the transaction.

The Supreme Court's decision should be treated as an additional guarantee of limiting law enforcement actions against entities that have not been charged with any crime, ensuring that they can exercise their property and not restrict their economic freedom.