On the issue of the qualification of the legalization (laundering) of funds or other property acquired by criminal means

Lubentseva Kristina Aleksandrovna Student; Faculty of Law; Southwestern State University 94, 50 let Oktyabrya str., Kursk, Russia, 305040 kristina.l46@mail.ru Yakovleva Elena Olegovna ORCID: 0000-0003-1733-3904 PhD in Law Associate Professor; Department of Criminal Law; Southwestern State University 94, 50 let Oktyabrya str., Kursk, Russia, 305040 pragmatik-alenka@yandex.ru

Ivanov Pavel Ivanovich Postgraduate student; Faculty of Law; Southwestern State University 94, 50 let Oktyabrya str., Kursk, Russia, 305040 Pasha_ivanov_99@inbox.ru

Introduction

Laundering of criminally obtained money is one of the most serious problems at both the national and international levels. This is due to the criminalization of the real sector of the economy. The process of legalizing illegally obtained income causes significant damage to the Russian economic system.

In the modern world, it is becoming increasingly difficult for criminal organizations to manage illegally obtained income due to increased state supervision over the movement of finances and property. This problem is especially acute for organized criminal structures, whose activities are mainly aimed at making a profit. That is why the process of legitimizing criminally acquired assets, known as money laundering, has become an integral part of criminal business. This secondary type of criminal activity has become widespread, as it allows bypassing existing barriers and introducing illegal income into legal circulation.

A number of researchers, including T. P. Stramilov, consider the legalization (laundering) of money or other property obtained by criminal means to be one of the forms of involvement in crime ^[1]. We believe that the legalization of funds or other property acquired illegally does not apply to forms of touching. Traditionally, they include the non-promised concealment of a crime, connivance of a crime, and non-reporting (non-reporting) of a crime.

There is an opinion that the legalization of property obtained by criminal means is one of the forms of concealment of a crime ^[2]. We share the point of view of A. V. Shesler, according to which the legalization of property acquired illegally does not refer to the concealment of a crime. Concealment is dangerous for society, as it creates obstacles to the administration of justice in criminal cases. The legalization of criminally acquired property can both complicate and facilitate the work of law enforcement agencies. In many cases, the appearance of such property on the criminal market helps to get on the trail of the criminal ^[3].

Income legalization is an action aimed at integrating criminally acquired property into the legal economy in order to legitimize the possession, use and disposal of this property.

There are two methods of legitimizing the proceeds of crime.:

n 1. conducting financial transactions or other transactions with funds or other property knowingly acquired illegally (the term "financial transaction" includes the concept of "other transaction", so we can talk about the legal and semantic similarity of these terms);

n 2. the use of objects of legalization in commercial or other economic activities ^[4].

Issues related to the study of the problems of qualification of the legalization (laundering) of funds or other property acquired by criminal means attract the attention of many researchers, such as: E. V. Batyukova, V. V. Veklenko, A. R. Akiev, E. K. Mynzhanov, T. S. Razuvaeva, A.V. Fominykh, E. G. Bykova and others.

Materials and methods

The methodological basis of this work is the following methods: dialectics, induction, deduction, as well as statistical, formal-logical and the method of regulatory analysis, which allow a deeper understanding of the problems of money laundering qualification. The empirical basis of the study was the official statistics of the Judicial Department of the Supreme Court for 2019-2024 in the field of prosecution for the legalization (laundering) of funds or other property acquired by criminal means.

Using the methodology, scientific articles published in 2015-2024 devoted to the problems of qualification of the legalization (laundering) of funds or other property acquired by criminal means were selected. Based on the conducted research, the main problems and recommendations for improving legislation were formulated.

Results and discussions

The legalization of criminal proceeds provided for in Articles 174 and 174.1 of the Criminal Code of the Russian Federation is characterized by a high level of secrecy, although the number of convicts under these articles is low annually. The legal framework for combating money laundering consists of two key documents. The first is the Federal Law "On Countering the Legalization (Laundering) of Proceeds from Crime and the Financing of Terrorism" dated 08/07/2001, No. 115–FZ, aimed at combating the legalization of criminal proceeds and the financing of terrorism. The second is Resolution No. 32 of the Plenum of the Supreme Court of the Russian Federation dated 07.07.2015 (as amended on 26.02.2019) "On judicial practice in cases of the legalization (laundering) of funds or other property acquired by criminal means, and on the acquisition or sale of property knowingly obtained by criminal means."

Thus, it is necessary to refer to the statistics of the number of persons convicted under Articles 174, 174.1 of the Criminal Code of the Russian Federation ^[5].

Statistics show a paradoxical situation: despite the significant number of criminals committing crimes related to illicit enrichment, only a few were directly responsible for the legalization of criminal proceeds. At the same time, most of the funds received from fraud and embezzlement were laundered. Such a significant gap in indicators indicates serious problems in identifying and proving the facts of the legalization of criminally acquired property by law enforcement agencies.

The formulation of the disposition of the articles under consideration raises questions. They state that a person may be held criminally liable for financial transactions and other transactions involving money or other property knowingly acquired by other persons through criminal means ^[6]. It is necessary to clarify: how many financial transactions or transactions do you need to prove to bring a person to justice — is one enough or should there be more? Paragraph 7 of Resolution No. 32 of the Plenum of the Supreme Court of the Russian Federation dated July 07, 2015 clarifies to the courts that one financial transaction or transaction aimed at money laundering is sufficient for qualification under this article. We consider it advisable to amend the text of Articles 174 and 174.1 of the Criminal Code of the Russian Federation, replacing the wording "financial transactions and other transactions with money or other property" with "financial transactions and other transactions".

When punishing the legalization of illegally obtained property, a key difficulty arises – the need to prove the specific purpose of the criminal. The subject should strive precisely to disguise the criminal origin of assets, making their use outwardly legitimate. For example, if the accused declares during the investigation that he acquired real estate in order to protect criminal proceeds from depreciation, and not to legitimize the possession of these funds, then the corpus delicti under Articles 174 and 174.1 of the Criminal Code of the Russian Federation may be absent due to the lack of evidence of the subjective side of the act.

In the absence of a fundamental goal, criminal prosecution becomes impossible, and the corpus delicti under the Criminal Code of the Russian Federation becomes invalid. Various financial manipulations, including international bank transfers, real estate transactions, investing in securities or opening deposits, are not in themselves sufficient grounds for initiating criminal prosecution. V. E. Batyukova believes that even if we are talking about actions with illegally obtained funds, whether it is withdrawing money from cards, transactions through bank accounts. employees or the acquisition of movable property - without proof of criminal intent, these transactions cannot serve as a reason to initiate proceedings ^[7]. We support her point of view, as an important aspect is understanding the intent with which these actions are performed.

Thus, in the field of criminal law, it becomes necessary to eliminate from part 1 of Article 174.1 of the Criminal Code of the Russian Federation the wording about the target orientation of this crime, which seems to be a reasonable solution. This proposal is due to the fact that law enforcement officers face difficulties in qualifying acts under Article 174.1 of the Criminal Code of the Russian Federation. These difficulties arise due to two main factors: firstly, due to the imperfection of legislative formulations regarding liability for laundering criminally obtained funds and property, and secondly, due to the lack of clear explanations from the supreme judicial authority when considering such criminal cases.

In addition, the statistics of the Judicial Department under the Supreme Court of the Russian Federation demonstrate the following pattern: criminal cases of money laundering most often reach court when it comes to large or especially large sums. There are several reasons for this:

Firstly, it is more difficult to hide financial transactions with large amounts. By law, such transactions are under the strict control of the Federal Financial Monitoring Service and the security services of financial Organizations ^[8].

Secondly, the legalization of large criminal proceeds poses a serious threat to the economic security of the country. V. V. Veklenko and A. R. Akiev emphasize that at the same time, laundering relatively small amounts, for example, 2000 rubles, is unlikely to have a noticeable impact on the state economy ^[9]. In this regard, we believe that it would be logical to introduce a minimum threshold for the amount of legalized funds, upon reaching which criminal liability may arise under the first parts of Articles 174 and 174.1 of the Criminal Code of the Russian Federation. This threshold can be designated as a "significant size" in the note to Article 174 of the Criminal Code of the Russian Federation, where definitions of "large" and "especially large" size are already given.

In addition, along with criminal liability, it would be advisable to establish administrative liability for laundering small amounts of criminal proceeds. To do this, it is possible to supplement Chapter 15 of the Administrative Code of the Russian Federation, devoted to administrative offenses in the financial sphere, with an article similar to Articles 174 and 174.1 of the Criminal Code of the Russian Federation, but without dividing into parts and defining the subject of the offense. This article could provide for liability for the legalization of funds and property obtained by criminal means.

There is a significant gap in Russian legislation regarding criminal prosecution for laundering criminally obtained funds abroad ^[10]. When an act is classified as criminal under the laws of a foreign state, but does not fall under Russian jurisdiction, a legal conflict arises. The lack of clear explanations in the Criminal Code of the Russian Federation and the Decisions of the Supreme Court creates a situation in which the legalization of proceeds of crimes committed in other countries in Russia remains virtually unpunished. The legislation requires the addition of a provision stating that if an act is recognized as criminal under the laws of the country of commission, then the subsequent laundering of funds received from it in Russia should also entail criminal liability.

In the overall picture of economic offenses, the proportion of solved crimes for laundering illegal income is extremely small, which indicates a high degree of latency. This situation creates serious problems – criminals are beginning to feel invulnerable, and the authority of the law is falling. The judicial system faces significant difficulties in qualifying the actions of those accused of money laundering and property laundering, since there are not enough precedents for considering such cases ^[11]. This creates difficulties in law enforcement practice when making decisions in cases of the legalization of illegally obtained assets.

The increased public danger of an act is that illegal income can be used to finance terrorist activities. M. A. Ershov in his work draws attention to the fact that this aspect needs special control, since the lack of such data reduces the effectiveness of not only the fight against money laundering, but also terrorism ^[12]. We support his point of view, as insufficient control and lack of data on financial transactions can create loopholes that allow criminal groups to use legalized funds to finance dangerous and illegal activities, including terrorism. This poses a direct threat to national and international security.

Conclusions

The problem of money laundering in Russia remains urgent and requires an integrated approach to be effectively addressed. An analysis of the current situation shows a significant discrepancy between the number of crimes related to illicit enrichment and the number of those prosecuted under Articles 174 and 174.1 of the Criminal Code of the Russian Federation. The existing legislative formulations and the lack of clear explanations in the rulings of the Supreme Court of the Russian Federation create difficulties in qualifying the actions of the accused and imposing punishment.

We have found out that in order to increase the effectiveness of the fight against money laundering, it is necessary:

1. Amend Articles 174 and 174.1 of the Criminal Code of the Russian Federation, replacing the wording on the commission of "financial transactions and other transactions" with "financial transaction and other transaction" to simplify the qualification;

2. To eliminate from part 1 of Article 174.1 of the Criminal Code of the Russian Federation the indication of the target orientation of the crime;

3. Establish a minimum threshold for the amount of legalized funds, upon reaching which criminal liability will occur;

4. Introduce administrative liability for laundering small amounts;

5. To supplement the legislation with a provision on criminal liability for the legalization in Russia of proceeds from crimes committed in other countries.

The implementation of these measures will increase the effectiveness of countering money laundering, strengthen the country's economic security and reduce the risk of financing terrorist activities.