Newsletter – July/20 | White Collar

STF SUSPENDS FREEZING OF ASSETSAND PUBLIC CIVIL ACTION DUE TO ADMINISTRATIVE IMPROBITY, DUE TO THE DISMISSAL OF A CRIMINAL ACTION ARISING FROM THE SAME FACTS, IN RESPECT TO THE NE BIS IN IDEM PRINCIPLE. THE DISMISSALL OCCURRED BECAUSE IT WAS CLEAR THAT THE DEFENDANT WAS NOT THE PERPETRATOR OF THE WRONGDOINGS
The Supreme Federal Court, in the judgment of the Precautionary Measure in the Constitutional Complaint No. 41557, determined the suspension of the freezing of assets and the suspension of the related public civil action due to administrative improbity, brought against a former state representative of São Paulo, until the final judgment of the Complaint.

The Rapporteur of the case, Justice Gilmar Mendes, argued that, since the judgment of the Habeas Corpus no. 158319 recognized that the defendant was not the perpetrator of the wrongdoings, the public civil action, which involved the same facts, would not have just cause. Consequently, neither would the freezing of assets.

This decision brings two main themes of great relevance in the criminal law field. The first one concerns the repercussions of a criminal sentence in the civil and administrative spheres.

In this regard, in the case of a sentence that acquits an individual, it will be necessary to observe the reasons for the acquittal. If the reason is that the defendant was not the perpetrator of the crime or that the facts did not exist, it will not be possible to claim any right in the other spheres. The same can be said of those who act in one of the justification cases provided for in Article 23 of the Penal Code.

On the other hand, if it is demonstrated that a certain conduct is not a crime, it is possible to claim, for example, damages in the civil sphere or impose a fine at the administrative level. This occurs because not all civil or administrative offenses constitute a crime.

In the case under analysis, it was recognized, in the habeas corpus that lead to the dismissal of the criminal action, that the defendant was not the perpetrator of the wrongdoings. Thus, it would not be possible to bring on another case, such as public civil action against the same individual for the same facts.

The second topic of great relevance concerns the impossibility of double jeopardy, in the same sphere or in different sanctioning spheres, as in criminal law and administrative sanctioning law, based on the same facts and evidence, with respect to the principle of nebis in idem.

Although the Federal Constitution (article 37, § 4) and the Civil Procedure Code (article 935) invoke a notion of independence between the different sanctioning spheres, such independence must be understood as mitigated, so as not to ignore the maxim ne bis in idem.

Therefore, considering that criminal law is more rigorous than administrative sanctioning law, the understanding established about certain facts by the Judiciary in the criminal sphere cannot be revised under the sanctioning administrative law. The reasoning is not the same for the reverse. Thus, the judgement of the facts by the Judiciary in the sanctioning administrative sphere can be revised by the criminal sphere.

BOLSONARO PRESENTS TO THE CONGRESS THE INTERNATIONAL CONVENTION ON CYBERCRIMES THAT CAN STIMULATE IMPORTANT CHANGES IN THE BRAZILIAN CRIMINAL LEGAL SYSTEM
In view of the recent controversies involving fake news and the dissemination of messages between Prosecutors and the former Minister of Justice, Sérgio Moro, while he was a judge of Operation Lava Jato, the President of the Republic, Jair Bolsonaro, forwarded to the Congress the text of the Budapest Convention on cybercrimes, signed in 2001, to which Brazil is a party.

The treaty aims to restrict a series of activities in the cyber sphere through criminalization. It also provides for matters of criminal procedural law and international cooperation on criminal matters and mutual assistance. Once in Congress, the treaty’s provisions may influence the creation of bills for better regulation of the matter in Brazil.

In relation to the provisions of substantive criminal law, the Convention states that the parties will take steps to establish as a criminal offense the willful act against the confidentiality, integrity and availability of computer systems and data.

Parties should also take steps to establish as a criminal offense the falsification and fraud of computer data. The treaty also provides for the criminalization of the dissemination of child pornography and the violation of copyright and related rights.

It is important to note that, although the text of the Convention is analyzed by Congress, Brazil already has, in its legal system, criminal offenses that comply with most of the treaty’s provisions. In this regard, Law No. 12737 / 2012 included Article 154-A in the Penal Code, which provides for the crime of computer device invasion, don in order to obtain, tamper with or destroy data or information unlawfully. In addition, paragraph 1 of the aforementioned article also provides for the crime of those who offer, distribute, sell or broadcast a device or computer program in order to allow the practice of hacking a computer device.

With regard to criminal procedural law, the Convention provides that parties are required to take measures to enable authorities to retain computer data in cases where there are reasons to believe that such data may be lost or altered and to enable competent authorities to collect, intercept and record data or to oblige service providers, within the scope of their technical capabilities, to collect and provide the authorities of the said data.

Finally, the Convention encourages the realization of international cooperation among the parties. The incentive proves to be salutary, since Brazil has a high demand for acts of international legal cooperation in criminal matters. In this regard, the Federal Government estimates that, of all orders made worldwide, Brazil is responsible for 80% of them.

Although Brazilian laws already provide considerably for substantive criminal law, there is an undeniable need to adapt criminal procedural legislation and the maturity of forms of international legal cooperation.

THE BRAZILIAN CHAMBER OF DEPUTIES APPROVES BILL THAT EXPANDS THE CRIME OF FALSE REPORT
The Brazilian Chamber of Deputies approved the Bill n. 2,810-A/2020 that aims to expand the crime of slanderous denunciation, provided in the article 339 of Brazilian Penal Code.

The current wording of the article 339 provides that the person who knowingly reports an innocent third party to the Public Authorities for a crime may be subject to criminal liability for the crime of false report if the report results in the opening of police investigation, lawsuit, administrative investigation, public civil inquiry or administrative improbity lawsuit.

The terms “police investigation” and “administrative investigation” are broad and may cover preliminary investigative situations. For example, the term police investigation could include preliminary investigations before the opening of a police inquiry.

Thus, the wording proposed by the Bill replaces “police investigation” with police inquiry and criminal investigative procedure (“PIC”). Likewise, the term “administrative investigation” is replaced by disciplinary administrative process (“PAD”). This proposed amendment makes the false report crime more precise, as it limits which procedures, if opened, are capable of ensuing criminal liability.

The Bill also expands criminal liability beyond knowingly accusing an innocent person a crime to also cover knowingly accusing an innocent person of an ethical-disciplinary infraction or improper act. In this regard, the Bill also seeks to cover situations in which the act that the innocent person is accused does not constitute a crime.

Finally, the bill will be sent to Senate in which will be analyzed, voted and eventually approved, before being sent to the analysis of the President.

THE BRAZILIAN CHAMBER OF DEPUTIES APPROVES BILL THAT INCREASE THE CASES IN WHICH THE IMPRISONMENT TIME FOR FRAUD IS INCREASED
The Brazilian Chamber of Deputies approved the Bill n. 2,068-A/2020 that aims to increase the cases in which the imprisonment time for fraud is increased, provided in the article 171 of Brazilian Penal Code.

According to current wording of the § 3º, article 171, the time of imprisonment is increased by a third (1/3) for those who commit the fraud and cause damage to public entity, or an institute for popular economy, social assistance or charity.

On the other hand, the bill provides also the increase sentence when the name of public entity has been damaged or unlawfully used. In the same sense, penalty may be increased if the fraud was committed by an incarcerated person through the unlawful use of cellphone, radio or similar device. Furthermore if the person who commits the crime is a public official taking advantage of the public function the penalty may be increased. Moreover, there is the increment if the person commits the crime impersonating a public official. The last possibility of increased sentence is if the crime is committed through any electronic medium or mass media.

The bill aims to increase the prison sentence in cases of fraud that seem to be on the rise, such as when imprisoned individuals fraud victims through mobile phones illegally obtained or when individuals impersonate public officials and deceive victims in order to obtain illegal advantages.

In conclusion, the bill will be sent to Senate in which will be analyzed, voted and may be approved, before being sent to the analysis of the President.

BRAZILIAN PUBLIC AGENCIES SIGN COOPERATION AGREEMENT TO FIGHT CORRUPTION AND SIGN LENIENCY AGREEMENTS
The Office of the Comptroller General of Brazil (“CGU”), Attorney General’s Office (“AGU”), Ministry of Justice and Public Safety (“MJSP”) and the Federal Court of Auditors (“TCU”) signed cooperation agreement regarding the fight against corruption and the signing of leniency agreements. Initially, the cooperation agreement would be also signed by the Federal Public Prosecutor’s Office (“MPF”). However, the Prosecutor General of the Republic , Augusto Aras, informed that despite the interest of the entity in the cooperation agreement, the Public Prosecutor’s Office is waiting for an internal analysis. The cooperation agreement was also signed by the Brazilian Supreme Federal Court’s President, Justice Dias Toffoli.

The cooperation agreement recognizes that corruption causes impacts in several spheres of law and its fight in Brazil depends of the participation of many public agencies, such as the abovementioned, with different jurisdictions and responsibilities. In this way, the cooperation agreement aims to encourage an articulated and joint action among the public agencies. Thus, when one of them is negotiating a leniency agreement, if it identifies situations of jurisdiction of another public agency, it should call to the other agency to also analyze and sign the leniency agreement.

Consequently, after the leniency agreement, other public agencies cannot punish the lenient company for the same facts, with respect to the principle of non bis in idem. In the same way evidence obtained in the leniency agreement cannot be used, directly or indirectly, to punish the lenient company in other ongoing proceedings. The evidence can only be used to in criminal or administrative liability of individuals or companies that did not sign agreements with the public agencies.

Finally, the technical cooperation agreement aims to remedy legal uncertainty, one of the biggest obstacles to the signing of leniency agreements. Before this agreement between the agencies, it was common that the leniency agreement was not valid before other agencies, which generated uncertainty about the fine established in the leniency agreement and its repercussions. It should be noted that the adhesion of the Federal Public Prosecutor’s Office to the technical cooperation agreement is fundamental for legal certainty, since it is the body that often plays a leading role in the signing of leniency agreements because it is the one who signs plea deals with individuals.

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