Katamadze: “Financial Investigation Service – a guarantee of independence and integrity of our state”


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Grigol Katamadze, Member of the Supervisory Board of the Ukrainian Business Council, President of the Association of Taxpayers of Ukraine on the Financial Investigation Service.

– The Association of Taxpayers of Ukraine has been publicly and consistently proposing the Concept of merging into the Service of Financial Investigations of Economic Units of the Tax Police within the SFS of Ukraine, the Department of the State Service for Combating Economic Crime (DSSCE) within the Ministry of Internal Affairs of Ukraine, the Department of Counterintelligence Protection State Economy (DCPSE) in the structure of the Security Service of Ukraine. There are problems with the division of competences, there is duplication of powers, there is no personal responsibility for the “shadow” economy, abuse and damage, and there is no coordination of the interaction of financial control authorities.

I am convinced that a thorough study and balanced implementation of the positive European experience is important for creating our own model of the role of our state in regulating financial and economic security. After all, this is a guarantee of the independence and integrity of our country and a condition for ensuring its financial and economic security.

Accumulated foreign experience (Austria, Georgia, Italy, Poland, USA, Sweden, Lithuania) shows that the state can effectively operate a single body to combat financial and economic crimes. Reducing the number of state bodies of financial control and financial investigations and creating a single law enforcement body specializing in the investigation of financial crimes is a fairly common practice in developed countries, and it only increases the effectiveness of such activities.

For example, for the last 20 years, the European methodology of pre-trial criminal proceedings has been based on the concept of ILP (Intelligence-Led Policing). Undoubtedly, this model has become an effective response to rapid globalization, which has expanded the possibilities of international organized crime, and has quickly proved its effectiveness. It revolutionized the European system of pre-trial investigation and made it possible to make a colossal leap forward both in terms of respect for the rights of citizens and legal entities and in terms of increasing the detection and work of police bodies to prevent (preventive, proactive crime detection) on the basis of data obtained from national and international databases, registers, and other sources, which are analyzed using special tools of forensic analysis, specially trained detective analysts who work only with databases and information and are not directly related to specific criminal proceedings.

Intelligence analytics provide information that law enforcement uses to identify targets. Today, ILP is integrated and successfully operates in most countries of the European Union and the United States.

I want to emphasize that the ILP model uses integrated data of all available information for risk management. Simply put, this model involves identifying and analyzing the problem before the offense is committed. The main tools for this model are information exchange and decision analysis. The existing model of combating economic crime in Ukraine, on the contrary, is more focused on overcoming the consequences of crimes. Successful implementation of ILP principles in law enforcement in the field of economics requires serious reform, significant organizational and structural changes, redistribution of law enforcement personnel, professional retraining of personnel, revision of functional tasks and job responsibilities, and so on. The establishment of the Service would be a logical step towards such implementation.

Now it is necessary to dwell on the main advantages of using the ILP model, which are:

– detection of criminal technologies and individuals and legal entities involved through the processing of large arrays of Big Data information using forensic analysis software (I2, Maltego, Palantir, Watson, IDAL, SAS, Semantrum, etc.);

– focusing on exposing criminal groups, criminal infrastructure, schemes and technologies of committing crimes that significantly affect the criminalization of public relations, and their investigation;

– support the simplification of the pre-trial investigation procedure by changing the approaches to determining the sufficiency and admissibility of evidence and making management decisions, building trust in the police body and social protection of its employees and, accordingly, reducing corruption risks;

– the definition of strategies to combat crime and tactics of criminal proceedings is carried out using risk and threat assessment methodologies (SPSS, SWOT, PEST, SOCTA, etc.);

– unified form of activity of foreign law enforcement institutions. As a result, its introduction will facilitate the integration of domestic law enforcement agencies into the European and international police community.

The main advantage of the new law enforcement agency should be a radical change in the approach to the investigation of financial crimes. After all, the creation of a new structure without a vision of the concept of its activities, without the introduction of an innovative approach in the work will give zero effect. The future law should implement the concept of a completely new format of law enforcement, its feature will be the change of force to analytical, and the Service will be guided by analysis and based on the use of modern risk-oriented methods of forensic analysis, as well as the relevant law enforcement agencies. Therefore, one of the most important functions of the new body will be information and analytical, and its work will be dominated by the intellectual component. The analytical activity will be based on monitoring all available databases in the country and abroad. The focus will be on the systematic collection and evaluation of information through a well-defined analytical process, as a result of which the data will be transformed into strategic and operational analytical products that support the actual data of the process of making sound management decisions. Therefore, the activities of the Service will be based on the use of its own information resources, data and information from available sources and the assessment of large data sets. This will eliminate the need to attract significant human resources, and the result will not depend on the algorithm set by the investigator or detective. These are the developed risk-oriented technologies that have long been available in countries that really fight economic crime.

In the process of creating the Service, the information-analytical systems and databases operating within the separate existing law enforcement agencies will be merged into a single analytical center of the new department, which will increase the efficiency of such analytical activities. Analysis of existing databases, formed in various domestic regulatory and law enforcement agencies, can be made quite efficient and productive by combining these information flows together, because the information content of these databases is quite satisfactory, and modern software allows you to do so.

Obviously, when it comes to the competence and authority of the Financial Investigation Service, it will be entrusted with the following main functions:

– participation in ensuring the security of the state through comprehensive counteraction to the spread of criminal threats in the economic sphere;

– prevention, detection, termination, investigation and disclosure of criminal offenses in the sphere of economic activity (in the economic sphere);

– preparation of proposals for the formation of state policy in the field of comprehensive counteraction to criminal offenses, counteraction to which falls within the competence of the Service.

To perform its functions, the Financial Investigation Service, as a body to combat financial crimes, should be empowered with a wide range of powers regarding access to information, opportunities in the field of information and analytical activities, application of procedural and operational measures, etc. . This is appropriate because such a body must operate efficiently and independently of an established bureaucratic system. The service should become a full-fledged law enforcement body with all the powers of a pre-trial investigation body defined by the Criminal Procedure Code of Ukraine. At the same time, according to the recommendations of the EU member states, this law enforcement body should be autonomous, ie it should conduct both investigations and operational work, as well as carry out analytical activities. This should be implemented in a concept where analytics will serve as the basis for the work of the whole body, while the investigation will remain a separate unit.

So, finally, I want to emphasize that the formation of the pre-trial investigation process should be based on the ILP model, ie be guided by intelligence analytics. The process of forming management decisions should be based on a system of risk and threat analysis. This can be ensured by creating an appropriate Big Data Center in the body structure.

The need to create a single body to investigate financial crimes is caused primarily by the large losses of our country due to various abuses. We hope for significant progress in this regard in the near future.

Read also “Expert: When establishing the Financial Investigation Service, the appropriate investigative authority should be clearly determined”

Translated by Yevhenii Kalinichenko


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