The law which the Armenian government pushed through the parliament in April allows prosecutors to investigate individuals in case of having “sufficient grounds to suspect” that the market value of their assets exceeds their “legal incomes” by at least 50 million drams ($103,000). Should the prosecutors find such discrepancies they can ask courts to nationalize those assets even if their owners are not found guilty of corruption or other criminal offenses.
The latter will have to prove the legality of their holdings if they are to retain them. They will also be given the option of reaching an out-of-court settlement with the prosecutors, which would require them to hand over at least 75 percent of their assets in and outside Armenia to the state.
Prime Minister Nikol Pashinian has repeatedly portrayed the law as a major anti-corruption measure that will help the authorities recover “wealth stolen from the people.” Pashinian has indicated his intention to use it against the country’s former rulers and their cronies branded by him as “plunderers.”
The politically sensitive process will be handled by a special team of prosecutors. Prosecutor-General Artur Davtian appointed on Thursday the head of the new division, his deputy and three other members, all of them prosecutors.
The division will be overseen by Srbuhi Galian, who was appointed as deputy prosecutor-general on Tuesday. The 28-year-old Galian served as a deputy minister of justice until then.
Later on Thursday Davtian met with the new appointees to discuss practical modalities of their work. According to his press office, the chief prosecutor told them that they will be performing “unprecedented” functions and must make sure that there are “necessary legal grounds” for initiating asset seizures.
The two opposition parties represented in the Armenian parliament have backed the legal mechanism for asset forfeiture in principle.
But other, more hardline opposition groups and figures, among them supporters of former President Serzh Sarkisian, have condemned the law as unconstitutional and accused Pashinian of planning a far-reaching “redistribution of assets” to cement his hold on power.
Deputy Prime Minister Mher Grigorian likewise warned that the bill could scare away investors and lead to capital flight from Armenia when the government discussed and approved it last December.
President Armen Sarkissian cited those concerns when he signed the bill into law in May. “An unscrupulous enforcement of the law could undermine trust in the state and jeopardize its effectiveness,” read a statement released by Sarkissian’s office.
The statement specifically warned the authorities against arbitrarily accessing and using citizens’ personal data, breaching bank secrecy or hampering business activity and competition.