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Understanding Civil and Criminal Remedies in France for Financial Crimes

Introduction to Civil and Criminal Remedies in France

France's legal system, deeply rooted in the civil law tradition, offers a codified approach to addressing financial crimes such as fraud, embezzlement, and money laundering. Since the introduction of the Napoleonic Civil Code in 1804 and the subsequent Criminal Code in 1810, France has developed a comprehensive legal framework that continues to evolve. This article explores the mechanisms available within the French legal system for pursuing civil remedies alongside criminal proceedings in the context of financial crime litigation in France. Understanding these processes is essential for effectively managing claims and maximising recovery efforts.

French Legal Framework: An Overview

The French legal system is one of the leading examples of the civil law system. Since the introduction of the Napoleonic Civil Code in 1804, France’s legal framework is based on statutes enacted by Parliament and is codified. Case law, although it interprets and completes Parliamentary Statutes, bears limited weight in the law-making process, as compared to common law jurisdictions. The first Criminal Code was introduced in 1810 and is subject to reforms on a constant basis, albeit without impacting its core structure. The Code of Criminal Procedures, which governs the issue of parallel proceedings, was first introduced in 1957.

Criminal offences are defined and sanctioned by provisions of the Criminal code. There are three categories of offences: “contraventions” (the less serious offences, which cannot carry a prison sentence), “délits” (serious misdemeanours) and “crimes” (the most serious offences and only offences to be tried in front of a jury). Offences like fraud, embezzlement, corruption and money laundering are “délits”. The gravity of the offence influences the technicalities of the proceedings.

How Criminal Proceedings Work in France

The authority to investigate and prosecute crimes is determined by the location where those crimes were committed. Hence, the competent prosecutor is the prosecutor of the tribunal judiciaire where the offence was committed. The criminal proceedings are first brought before a Prosecutor, who reviews the complaints and decides whether or not to investigate them, the investigation is then carried out by an Investigating Judge, who has the mission of conducting the entire investigation from the case opening until trial. The recourse to an Investigating Judge is mandatory to investigate “crimes”, but only optional for less serious offences, such as “délits” and “contraventions”.  In the case of fraud, or corruption, or other financial crime if the offence is not complex, or the investigation already carried out by the police is sufficient, the prosecutor may send the matter directly to the criminal court, without the Investigating Judge.  In more complex cases, however, the prosecutor has the option to send the case to the Investigating Judge.

At the end of the investigation, the defendant, if charged, is ultimately tried in front of a first instance tribunal. Appeals are heard by the local court of appeal, and ultimate recourse on matters of law are heard by the Cour de Cassation.

Parallel Civil and Criminal Proceedings in France

The victim of an offence such as a fraud has several ways to obtain compensation for the loss they suffered.

The first one is criminal complaint (Code of Criminal Procedure, article 1). A criminal complaint is the way to commence criminal proceedings.

Under French law, criminal proceedings encompass in the same procedure the prosecution of the offender (“Action Publique”) that could lead to criminal punishment (imprisonment and/or a fine) and the action to compensate the harm resulting from the offence (“Action Civile”) (Code of Criminal Procedure, article 3) that allows the victim to obtain a judgment for damages.

The second option, is to pursue separate proceedings in front of a civil judge at any time during the criminal proceedings (Code of Criminal Procedure, article 4). However, following the principle una via electa, once the victim has opted to bring separate civil proceedings, they can no longer bring the action before a criminal court (Code of Criminal Procedure, article 5). The decision to pursue separate proceedings is irrevocable.

There are various situations where criminal and civil proceedings can exist in parallel: where the criminal proceedings are commenced by the prosecutor or by a third party for instance, however the victim of a fraud has to decide its path and cannot pursue the two at the same time. The option has to be made at the beginning and is critical; each path having advantages and disadvantages.

Commencing criminal proceedings has several substantial benefits for the victims:

Means of investigation

The Investigating Judge, who specialises in investigations, leads the process of gathering and examining evidence with the help of the police. This method is broader and more effective than the process available to someone bringing a claim in civil court, where there is no formal disclosure phase, no direct questioning of witnesses, and evidence must be presented in written form;

Statute of limitation

When the victim joins the civil claim to the criminal proceedings, it benefits from the same statute of limitation (twenty years for crimes, six years for other offences). If the victim chooses to bring separate civil proceeding, the proceedings follow the statute of limitation set out in the Civil Code, which generally is five years.

Costs

As far as costs are concerned the two options are not very different. In criminal proceedings, like in civil proceedings, the victim has to pay their legal fees and can eventually recover a small fraction of them. However, in some cases criminal proceedings could have a significant advantage in terms of costs: where expert evidence is needed, in criminal proceedings the costs of the expert are paid by the justice department but have to be met by the claimant in civil proceedings.

However criminal proceedings are much longer than ordinary civil proceedings and are largely outside the control of the victim.

This is why the choice between civil and criminal proceedings open to the victim of a fraud or of any offence must be made after an in-depth analysis on the facts of the case taking into account the extent and nature of evidence available and the kind of offence to be pursued.

Conclusion

Navigating the French legal system to address financial crimes requires a thorough understanding of the interplay between criminal and civil proceedings. France offers a robust framework for victims to seek compensation through either criminal complaints or separate civil actions, each with its own advantages and limitations. The choice between these routes hinges on a careful analysis of the specifics of each case, including the nature of the offence and the available evidence. By leveraging the investigative powers of the criminal justice system and understanding the procedural nuances, claimants can strategically pursue their claims. Professional legal guidance is crucial to making informed decisions and effectively utilising the tools available within the French legal framework to achieve successful outcomes in financial crime cases.

Our expertise

With offices in many of the world’s major financial centres, including London, Paris, Geneva, Zurich, Dubai, Hong Kong and Singapore, we are ideally placed to work with you to prevent, resolve and assist with financial crime disputes and investigations as they arise, whatever the law, language, rules, industry sector, or subject matter of that dispute may be. Our dedicated multicultural and multilingual specialists conduct proceedings under both common law and civil systems and regularly act in fraud-related proceedings.

Whether you are an individual or a business, our strategically focused specialists will work alongside you through every aspect of any proceedings. Please contact the author or your usual Charles Russell Speechly LLP contact if you would like to get in touch.

Frequently Asked Questions about financial crime remedies in France

In France, can civil remedies be sought within criminal proceedings?

Yes.  Under French law, criminal proceedings allow for:

  • the prosecution of the offender (“Action Publique”) that could lead to criminal punishment (imprisonment and/or a fine); and
  • an action to compensate the harm resulting from the offence (“Action Civile”) (Code of Criminal Procedure, article 3) that allows the victim to obtain a judgment for damages.

In France, what are the time limits [or what is the limitation period] for bringing a fraud claim?

If the victim opts to bring civil proceedings after criminal proceedings have been commenced, they will benefit from the same limitation period as in criminal proceedings.

This is a time limit of 20 years for crimes and 6 years for other offences.
If the victim brings separate civil proceedings, the claim will follow the limitation period set out in the Civil Code which is generally 5 years.

In France, what interim remedies are available for a civil claim brought within criminal proceedings?

In criminal proceedings, the Investigating Judge can take various measures to investigate by gathering evidence and speaking to the police. The French courts can also order interim measures such as the freezing of assets, a travel ban and provisional imprisonment of the offender.

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