4.6 Ancillary Orders Ancillary orders are subsidiary orders to a restraint or seizure order. Their purpose is to increase the effectiveness of the primary order. Examples are orders • requiring a target or persons associated with a target to disclose details of the nature and location of the target’s assets; • placing restrained or seized assets under the control of an asset manager (see chapter 5); • requiring a target to be examined under oath before an official of a court or other appropriate authority regarding his or her assets; and • requiring third parties to produce documents relating to the assets of a target. Disclosure and examination powers can be useful ways to probe complex asset holdings and obtain evidence useful in defending against applications to fund expenses from restrained funds. A prosecutor should not conduct examinations unless he or she is familiar with all available information on the assets and is in a position to test and challenge evidence given by the examinee. Information from a financial institution, for example, may be used to show that a target is failing to disclose assets, and it may lead to charges of contempt or failure to comply. To protect a target’s privilege or right against self-incrimination, evidence obtained under an ancillary order may not be used in related criminal proceedings.112 The examiner should identify potential targets of criminal proceedings and be aware of the ramifications of eliciting incriminating evidence. Close consultation with the criminal prosecutors is necessary.
4.7 Third-Party Interests Third-party claims will inevitably arise in cases of asset restraint or seizure. Targets often will have complicated holdings that involve third parties with legitimate interests— for example, business partners and investors. A third party may have an interest in or own an instrumentality that was used in the commission of an offense but be unaware of the illegal uses to which it was put. Or the legitimacy of the third party’s interest may be at issue: On paper, the third party may own an asset that is alleged to be controlled by a target or it may be alleged that the third-party owner was not a bona fide purchaser. Where a third party holds an interest or share in a business or investment venture with a target, practitioners will want to ensure that the interest is held bona fide and that the maximum amount of funds available for legal expenses is calculated as a percentage of the total funds, and there are limits on the legal rates. 112. These protections are usually set out in legislation or enshrined as constitutional rights. Some jurisdictions also require an undertaking by the prosecution.
Securing the Assets
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