Liability occurs when there are transactions with property obtained by criminal means

Russia calls the condition for recognizing transactions with BTC laundering

04.07.2023 - 09:05


3 min

What’s new? A representative of the Federal Financial Monitoring Service (Rosfinmonitoring)in a comment to RBC said that a prerequisite for criminal liability for transactions with cryptocurrencies is the existence of transactions with property obtained by criminal means. According to him, according to the legislation, such transactions are any operations with fiat, including cash and non-cash payments, cash transactions, transfer or exchange of money, as well as the exchange of one currency for another. This is how the regulator commented on the decision of the Supreme Court, which recognized the transfer of bitcoins in rubles as money laundering in the case of drug trafficking.

RBC’s material

More details about the situation. In June, the Supreme Court reviewed the verdict of the court of first instance against the defendant who was found guilty of drug trafficking, but acquitted in the case of BTC legalization. He received payments in BTC to his wallet, then converted them into fiat currency and transferred them to the accounts and cards of his cohabitant’s daughter, thus receiving more than 8 million Russian rubles (RUB). The case has been sent for a new hearing.

As explained by the representative of Rosfinmonitoring, the court reasonably pointed out that the conversion of the cryptocurrency obtained by criminal means into fiat currency is the legalization of criminal income. In this, mandatory involvement of the money legalized in economic turnover is not required, “since liability under the specified article of the law comes upon establishment of the very fact of financial transactions in order to give a lawful appearance to the possession, use, and disposal of money or other property.”

Anton Gusev, a partner of the law firm “Timofeev, Gusev and Partners” noted that “actions aimed at giving the appearance of legality to the property obtained illegally are subject to criminal punishment.” “Nobody questions bringing to responsibility for money laundering a person who stole money and then bought on it, for example, bills of exchange of one’s bank,” noted the lawyer. According to Gusev, the misunderstanding is that for a long time in the Russian Federation, cryptocurrencies were not legally recognized as property, which does not meet the existing realities.

Gleb Krokhmalyuk, a lawyer at Digital & Analogue Partners, believes that the Supreme Court has actually recognized bitcoin as property because, for a crime under Article 174.1 of the Criminal Code, it is necessary to make a transaction with property or money. So, he says, “Despite the criminal context of the case, another recognition of BTC as the full-fledged property will have a positive impact on the legal protection of all crypto users, as courts will no longer be able to ignore the status of digital assets.”

In April, a court in Novosibirsk began to consider the first criminal case in Russia on the appropriation of assets of a cryptocurrency exchange. The defendant in the case is a former system administrator of the WEX platform. The amount of damage exceeds 3 billion RUB in cryptocurrencies.

And in May last year, the court of St. Petersburg, during the consideration of the extortion case, for the first time recognized cryptocurrency as a means of payment.

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