{"id":29267,"date":"2020-09-28T08:51:03","date_gmt":"2020-09-28T05:51:03","guid":{"rendered":"https:\/\/forklog.com\/en\/?p=29267"},"modified":"2025-08-27T16:03:15","modified_gmt":"2025-08-27T13:03:15","slug":"ukraines-fight-against-cybercrime-how-authorities-want-to-monitor-traffic-and-seize-crypto-assets","status":"publish","type":"post","link":"https:\/\/u1f987.com\/en\/ukraines-fight-against-cybercrime-how-authorities-want-to-monitor-traffic-and-seize-crypto-assets\/","title":{"rendered":"Ukraine&#8217;s fight against cybercrime: how authorities want to monitor traffic and seize crypto assets"},"content":{"rendered":"<p><span style=\\\"font-weight: 400;\\\">In September the Verkhovna Rada of Ukraine <\/span><a href=\"https:\/\/u1f987.com\/en\/news\/ukraine-registers-bill-on-cryptocurrency-confiscation\"><span style=\\\"font-weight: 400;\\\">registered<\/span><\/a><span style=\\\"font-weight: 400;\\\"> Bill No. 4004, \\&#8221;On Amendments to the Criminal Procedure Code of Ukraine to enhance the effectiveness of the fight against cybercrime and the use of electronic evidence\\&#8221;.<\/span><\/p>\n<p><!--more--><\/p>\n<p><span style=\\\"font-weight: 400;\\\">It introduces the concept of electronic evidence and makes changes to the mechanism by which law enforcement accesses information about user traffic from operators.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">It also outlines the procedure for confiscating digital currencies obtained through illicit activity.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">According to the explanatory note, the bill is intended to combat cybercrime. However some argue that certain measures proposed by the bill conflict with constitutional rights and freedoms, and the document is likened to Russia&#8217;s \\u201cYarovaya package\\u201d.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">ForkLog examines the potential consequences of the bill for Ukrainians.<\/span><\/p>\n<div class=\\\"wp-block-text-wrappers-keypoints article_keypoints\\\">\n<ul class=\\\"wp-block-list\\\">\n<li>The amendments introduce the concept of electronic evidence. Among them are cryptocurrencies which are proposed to be confiscated if obtained as a result of illicit activity.<\/li>\n<li>Changes could also simplify law enforcement access to user information obtained from operators.<\/li>\n<li>Experts say the documents require refinement and clarification of the mechanisms for obtaining access to user information to prevent violations of the right to the secrecy of correspondence.<\/li>\n<\/ul>\n<\/div>\n<p><a style=\\\"text-decoration: underline;\\\" title=\\\"View The bill on Scribd\\\" href=\\\"https:\/\/www.scribd.com\/document\/476862952\/%D0%9F%D1%80%D0%BE%D0%B5%D0%BA%D1%82-%D0%B7%D0%B0%D0%BA%D0%BE%D0%BD%D0%B0#from_embed\\\">The bill<\/a> by <a style=\\\"text-decoration: underline;\\\" title=\\\"View ForkLog's profile on Scribd\\\" href=\\\"https:\/\/www.scribd.com\/user\/456422024\/ForkLog#from_embed\\\">ForkLog<\/a> on Scribd<\/p>\n<p><iframe loading=\\\"lazy\\\" id=\\\"doc_26245\\\" class=\\\"scribd_iframe_embed\\\" title=\\\"The bill\\\" src=\\\"https:\/\/www.scribd.com\/embeds\/476862952\/content?start_page=1&#038;view_mode=scroll&#038;access_key=key-2KMvxrvnFQiCaLL8n7lf\\\" scrolling=\\\"no\\\" data-auto-height=\\\"false\\\" data-aspect-ratio=\\\"0.7080062794348508\\\" width=\\\"100%\\\" height=\\\"600\\\" frameborder=\\\"0\\\"><\/iframe><\/p>\n<p><span style=\\\"font-weight: 400;\\\">According to the document, electronic evidence is defined as \\u201cinformation in digital form with data that may be used as evidence of facts or circumstances established during criminal proceedings\\u201d.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">In addition to electronic documents, websites, text and voice messages and other data, the authors of the bill also include virtual assets.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">If cryptocurrencies are part of a criminal offense, they may be confiscated. An exception is when their owner \\u201cdid not know or could not know about their illicit use\\u201d.<\/span><\/p>\n<blockquote class=\\\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\\\">\n<p><span style=\\\"font-weight: 400;\\\">\\u201cToday, special confiscation does not affect virtual assets, though the laundering of proceeds obtained through criminal activity largely occurs via unregulated virtual markets,\\u201d said in the explanatory note.<\/span><\/p>\n<\/blockquote>\n<p><span style=\\\"font-weight: 400;\\\">As an example of an \\u201cuncontrolled virtual market\\u201d they cite the Silk Road darknet marketplace.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">Under the bill, virtual assets (VA) are confiscated in the following cases:<\/span><\/p>\n<ul class=\\\"wp-block-list\\\">\n<li style=\\\"font-weight: 400;\\\"><span style=\\\"font-weight: 400;\\\">when they \\u201care made, adapted or used as means or instruments of committing a criminal offense\\u201d;<\/span><\/li>\n<li style=\\\"font-weight: 400;\\\"><span style=\\\"font-weight: 400;\\\">used to induce a person to commit a crime, to finance it;<\/span><\/li>\n<li style=\\\"font-weight: 400;\\\"><span style=\\\"font-weight: 400;\\\">if they \\u201cwere the subject of a criminal offense or another socially dangerous act\\u201d;<\/span><\/li>\n<li style=\\\"font-weight: 400;\\\"><span style=\\\"font-weight: 400;\\\">when they passed to a person connected with someone convicted of corruption or money laundering, \\u201cif the court has not confirmed the legality of acquiring rights to such virtual assets, as well as to the income from them\\u201d. The latter includes legal entities that received cryptocurrencies from the convict.<\/span><\/li>\n<\/ul>\n<p><span style=\\\"font-weight: 400;\\\">If the court finds no lawful basis for the rights to part of the VA, that portion will be confiscated.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">If confiscation of the VA is not possible, and the legality of the acquisition of rights to which has not been established, the convicted person must pay their value.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">If the owner of the cryptocurrencies did not know about their criminal use, the assets should be returned. If the owner cannot be identified, they pass to the state.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">A decision to confiscate VA is issued only after proof of the owner\\&#8217;s awareness of their illicit origin or use.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">Disputes over VA ownership are resolved in civil proceedings.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">According to Artem Afyan, managing partner at Juscutum, the introduction of the possibility to confiscate cryptocurrency at this stage is a controversial proposal \\u201cdue to the specifics of regulating the virtual asset market\\u201d.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">Senior lawyer in criminal law and business protection practice at Arzinger, Alexey Zadoenko, told ForkLog that the \\u201cs bill on virtual assets \\u2014 the bill on virtual assets has been revised several times and is still not adopted. <\/span><a href=\"https:\/\/u1f987.com\/en\/news\/ukraine-registers-updated-draft-law-on-virtual-assets\"><span style=\\\"font-weight: 400;\\\">Bill on virtual assets<\/span><\/a><span style=\\\"font-weight: 400;\\\"> has been revised several times and remains unadopted.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">Rushing the entry into force of the procedure for handling virtual assets by investigators and prosecutors before a general law on such assets is adopted is described as \\u201cnot entirely clear and premature\\u201d:<\/span><\/p>\n<blockquote class=\\\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\\\">\n<p><span style=\\\"font-weight: 400;\\\">\\u201cAnd given law enforcement\\&#8217;s well-known fondness for bending legislative gaps to their own ends, it is quite risky.\\u201d<\/span><\/p>\n<\/blockquote>\n<p><span style=\\\"font-weight: 400;\\\">Afyan noted that the authors of the current bill do not provide a definition of virtual assets. If it is adopted, law enforcement will refer to the existing law on counteracting money laundering and financing of terrorism, the lawyer said.<\/span><\/p>\n<blockquote class=\\\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\\\">\n<p><span style=\\\"font-weight: 400;\\\">\\u201cThe definition of virtual assets, as a digital expression of value that can be traded in digital form or transferred, and that can be used for payment or investment purposes, is a matter of debate,\\u201d emphasised Afyan.<\/span><\/p>\n<\/blockquote>\n<p><span style=\\\"font-weight: 400;\\\">In addition to provisions on confiscating cryptocurrencies, the bill obliges operators to bear the cost of installing the technical means necessary to carry out \\u201coperational-search measures, covert investigative actions and temporary access to information\\u201d about the subscriber.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">They must also assist the investigation and \\u201cnot to disclose organizational and tactical methods\\u201d of its conduct.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">The explanatory note states that the measures proposed by the bill aim to \\u201cimprove the procedure for covert investigative (search) measures in criminal proceedings involving cybercrime suspects\\u201d.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">The provision on temporary access to information, which operators and providers must facilitate, is described as controversial by lawyers.<\/span><\/p>\n<blockquote class=\\\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\\\">\n<p><span style=\\\"font-weight: 400;\\\">\\u201cThe aim of such a norm could be a veiled desire by law enforcement to access users\\&#8217; private communications, bypassing the decision-making process of the Appellate Court (which exists today), replacing it with a simpler local-court order,\\u201d says Zadoenko.<\/span><\/p>\n<\/blockquote>\n<p><span style=\\\"font-weight: 400;\\\">In the Internet Association of Ukraine <\/span><a href=\\\"https:\/\/inau.ua\/document\/lyst-no-1081-3-vid-10092020-vru-shchodo-zauvazhen-ta-propozyciy-do-zakonoproektu-no-4004\\\" target=\\\"_blank\\\" rel=\\\"noopener noreferrer\\\"><span style=\\\"font-weight: 400;\\\">noted<\/span><\/a><span style=\\\"font-weight: 400;\\\"> that the purchase of technical equipment, \\u201cyou need by law enforcement to perform their functions and powers, should be funded exclusively from the state budget, and not through financing such processes by business structures\\u201d.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">The coalition \\u201cFor a Free Internet\\u201d <\/span><a href=\\\"https:\/\/dslua.org\/publications\/paket-zakonoproektiv-shchodo-protydii-kiberzlochynnosti-ta-posylennia-sanktsiynoho-mekhanizmu-vid-1-veresnia-2020-roku-mistyt-zahrozy-dlia-tsyfrovykh-prav-zaiava-koalitsii-za-vilnyy-internet\/?fbclid=\\\" rel=\\\"noopener noreferrer\\\"><span style=\\\"font-weight: 400;\\\">stated<\/span><\/a><span style=\\\"font-weight: 400;\\\"> that this contradicts the EU Directive on electronic commerce, which prohibits imposing a general obligation on intermediaries to monitor information transmitted through them, the statement said.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">Meanwhile, lawyers note that the requirement to install special equipment does not substantially narrow telecoms rights, as the obligation to install it existed previously as well.<\/span><\/p>\n<blockquote class=\\\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\\\">\n<p><span style=\\\"font-weight: 400;\\\">\\u201cThe proposed changes merely specify the information to which access may be granted, and the grounds for such access are defined as covert investigative actions,\\u201d said Alexey Zadoenko.<\/span><\/p>\n<\/blockquote>\n<p><span style=\\\"font-weight: 400;\\\">In addition to Bill No. 4004, the Verkhovna Rada <\/span><a href=\\\"http:\/\/w1.c1.rada.gov.ua\/pls\/zweb2\/webproc4_1?pf3511=69770\\\" target=\\\"_blank\\\" rel=\\\"noopener noreferrer\\\"><span style=\\\"font-weight: 400;\\\">registered<\/span><\/a><span style=\\\"font-weight: 400;\\\"> another bill \u2014 \\u201cOn Amendments to the Criminal Procedure Code of Ukraine and the Code of Ukraine on Administrative Offenses to enhance the effectiveness of countering cyberattacks\\u201d.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">It obliges operators and providers to store traffic data for a year, \\u201cdone in a volume sufficient to identify the subscriber\\u201d. Law enforcement will be able to access this information by order of a investigator or prosecutor.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">In the Internet Association of Ukraine <\/span><a href=\\\"https:\/\/inau.ua\/document\/lyst-no-1071-3-vid-10092020-vru-shchodo-zauvazhen-ta-propozyciy-do-zakonoproektu-no-4003\\\" target=\\\"_blank\\\" rel=\\\"noopener noreferrer\\\"><span style=\\\"font-weight: 400;\\\">note<\/span><\/a><span style=\\\"font-weight: 400;\\\"> that access to such information must occur \\u201conly on the basis of a court decision\\u201d.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">The document also allows law enforcement to access information \\u201cin electronic information systems\\u201d that are not subject to a search of case if the investigator or prosecutor decides that it is important for the criminal production.<\/span><\/p>\n<blockquote class=\\\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\\\">\n<p><span style=\\\"font-weight: 400;\\\">\\u201cThis provision grants unlimited discretion to law enforcement and offers no safeguards to protect a person\\u2019s right to the secrecy of correspondence,\\u201d said the \\u201cFor a Free Internet\\u201d coalition.<\/span><\/p>\n<\/blockquote>\n<p><span style=\\\"font-weight: 400;\\\">Such a possibility is bound to raise concerns, especially as law enforcement interests increasingly turn to the internet space.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">In September, the secretary of the National Security and Defence Council of Ukraine, Oleksiy Danilov, <\/span><a href=\\\"https:\/\/www.facebook.com\/watch\/live\/?v=244105853696907&#038;ref=watch_permalink\\\" target=\\\"_blank\\\" rel=\\\"noopener noreferrer\\\"><span style=\\\"font-weight: 400;\\\">stated<\/span><\/a><span style=\\\"font-weight: 400;\\\"> that users of the social network \\u201cVKontakte\\u201d, blocked in the country, will face \\u201ccertain problems directly with our police, with our security agencies\\u201d.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">***<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">Experts interviewed by ForkLog note that, on one hand, the proposed legislative changes could speed up cybercrime investigations and bring clarity to electronic evidence handling.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">However, the impact may be limited to small-time offenders, says Dmitry Budorin, cybersecurity expert and CEO of Hacken:<\/span><\/p>\n<blockquote class=\\\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\\\">\n<p><span style=\\\"font-weight: 400;\\\">\\u201cCriminals don\\u2019t always have higher education, but even they can outwit surveillance mechanisms and they have IT consultants.\u001d<\/span><\/p>\n<\/blockquote>\n<p><span style=\\\"font-weight: 400;\\\">He also noted that it remains unclear whether there will be protection for citizens against potential abuses of such powers beyond relying on trust in government agencies:<\/span><\/p>\n<blockquote class=\\\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\\\">\n<p><span style=\\\"font-weight: 400;\\\">\\u201cThere must be a clear understanding and wording of what constitutes a criminal offense, what is a socially dangerous act, in which covert cases state authorities may request data, and in which this should be restricted.\\u201d<\/span><\/p>\n<\/blockquote>\n<p><span style=\\\"font-weight: 400;\\\">Managing partner at A\u041e \\u201cTarasyuk &#038; Partners\\u201d, Sergey Tarasyuk, believes the proposed changes could violate the constitutional right to the secrecy of correspondence.<\/span><\/p>\n<blockquote class=\\\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\\\">\n<p><span style=\\\"font-weight: 400;\\\">\\u201cLaw enforcement is significantly eased in intruding into private correspondence,\\u201d he told ForkLog.<\/span><\/p>\n<\/blockquote>\n<p><span style=\\\"font-weight: 400;\\\">Forcing operators to install equipment and provide temporary access to subscriber information is described as \\u201ca direct path to a police state\\u201d by Artem Afyan of Juscutum.<\/span><\/p>\n<p><span style=\\\"font-weight: 400;\\\">Kuna exchange founder Mikhail Chobanian said such steps \\u201chave long been the reality of a new world\\u201d.<\/span><\/p>\n<blockquote class=\\\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\\\">\n<p><span style=\\\"font-weight: 400;\\\">\\u201cBut there is another side of the coin \u2014 a huge incentive to develop decentralised systems. For every action there is a reaction. That is how all systems balance,\\u201d he noted.<\/span><\/p>\n<\/blockquote>\n<p><span style=\\\"font-weight: 400;\\\">Dmitry Budorin sees another potential upside of adopting the bills: a higher level of tech awareness among the population. He says that unless a \\u201cGreat Firewall of China\\u201d is built, most people will move to VPNs.<\/span><\/p>\n<blockquote class=\\\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\\\">\n<p><span style=\\\"font-weight: 400;\\\">\\u201cFighting crime will be easier, constitutional rights will be further eroded, and virtual assets will become less safe repositories of hard-earned funds,\\u201d summed up lawyer Sergey Tarasyuk.<\/span><\/p>\n<\/blockquote>\n<p>Subscribe to ForkLog news on Telegram: <a href=\\\"https:\/\/t.me\/forklogfeed\\\" target=\\\"_blank\\\" rel=\\\"nofollow noopener noreferrer\\\">ForkLog Feed<\/a> \u0010\u0010 all the latest news and polls on <a href=\\\"https:\/\/telegram.me\/forklog\\\" target=\\\"_blank\\\" rel=\\\"nofollow noopener noreferrer\\\">ForkLog<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In September the Verkhovna Rada of Ukraine registered Bill No. 4004, &#8216;On Amendments to the Criminal Procedure Code of Ukraine to Enhance the Effectiveness of Combating Cybercrime and the Use of Electronic Evidence&#8217;.<\/p>\n","protected":false},"author":1,"featured_media":29268,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"1","news_style_id":"1","cryptorium_level":"","_short_excerpt_text":"","creation_source":"","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[1144],"tags":[1153,1256,36,16],"class_list":["post-29267","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-longreads","tag-confiscation","tag-privacy-and-personal-data","tag-regulation","tag-ukraine"],"aioseo_notices":[],"amp_enabled":true,"views":"7","promo_type":"1","layout_type":"1","short_excerpt":"","is_update":"","_links":{"self":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/29267","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/comments?post=29267"}],"version-history":[{"count":1,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/29267\/revisions"}],"predecessor-version":[{"id":29269,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/29267\/revisions\/29269"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media\/29268"}],"wp:attachment":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media?parent=29267"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/categories?post=29267"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/tags?post=29267"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}