Cryptocurrency as a Subject of Bribery: Issues of Legal Regulation and Ways to Overcome Them

Ageev Vyacheslav Nikolaevich PhD in Law Associate Professor; Department of Advertising, Public Relations and Linguistics; National Research University 'MEI' Krasnokazarmennaya str., 14, Moscow, 111250, Russia ageev_fksu@mail.ru Other publications by this author

In the context of the transformation of socio-economic processes and the complication of public administration mechanisms, corruption acquires the character of a stable complex of illegal encroachments aimed at violating the legally established procedure for exercising state and municipal powers, discrediting the activities of public authorities and distorting economic relations based on the principles of legality and fair competition, which together leads to a real limitation of opportunities for implementation and effective judicial protection of the constitutional rights and legitimate interests of the individual.

At the same time, the analysis of law enforcement and investigative practice allows us to state that the expansion and modernization of anti-corruption legislation and the institutional system for combating corruption do not eliminate the ability of subjects of corruption crimes to adapt to a changing legal environment, as they master new, legally complex ways of transferring and concealing illegal remuneration, including the use of non-cash payment mechanisms and digital financial assets, including cryptocurrencies, which objectively increases the latency level of such acts and significantly complicates their detection, procedural consolidation and proof. In this regard, there is certainly an increasing need for further development and practical implementation of specialized forensic techniques, procedural tools and technical solutions adequate to modern financial and technological conditions for the commission of corruption crimes ^{[1, p. 85]}.

Modern research in the field of legal science demonstrates a clear increase in interest in corruption crimes and corruption-related offenses. ^[2],[3],[4]. Legal science is developing along the path of an intensive increase in both theoretical and applied work aimed at analyzing the criminal, forensic and procedural aspects of bribery, including its commission in the context of the digitalization of the economy and public relations.

The works of D. A. Seityagyaeva and S. I. Gritsaev address various issues, including the criminalistic classification of methods of transferring illegal remuneration, taking into account changes in the subjects of the crime ^[1]. The problems of qualification and investigation of acts committed using cryptocurrencies and other digital financial assets are considered in the works of D. A. Stepanenko and Ya. V. Garmyshev ^[5]. The specifics of identifying and analyzing digital traces in the investigation of bribery are analyzed by E. V. Khristinina ^[6]. Special attention in the work of D. M. Farakhiev is paid to the legal, organizational and tactical aspects of the work of operational and investigative bodies in the investigation of corruption crimes committed using modern financial and technological tools ^[7].

Within the framework of these issues, these studies focus on the use of cryptocurrencies as a subject of bribery, as well as on law enforcement, criminalistic, and organizational and practical difficulties faced by law enforcement agencies in investigating such crimes.

The present study focuses on a comprehensive rethinking and systematization of scientific approaches to the analysis of corruption crimes in which digital currency is the subject of criminal encroachment, with an emphasis on identifying legal, criminalistic, organizational and practical problems that arise in the activities of bodies of inquiry, preliminary investigation and operational units in identifying, recording and proving such acts. As part of this goal, the study aims to uncover the specifics of using cryptocurrencies as a subject of bribery, identify the most significant difficulties accompanying the investigation of corruption crimes involving digital financial assets, and develop scientifically sound proposals to improve the system for investigating digital forms of corruption.

The relevance of this issue is due to the steady increase in crimes committed in the information and telecommunications environment using digital financial instruments, which cause significant damage to public relations protected by criminal law in the field of public administration, public service and economic activity and objectively require further development of legal, criminal procedural and criminalistic counteraction mechanisms.

The regulatory and legal basis of the study is formed by the provisions of Federal Law No. 273-FZ of December 25, 2008 "On Combating Corruption", the Criminal Code of the Russian Federation No. 63-FZ of June 13, 1996 and Federal Law No. 259-FZ of July 31, 2020 "On Digital Financial Assets, Digital Currency and Amendments amendments to certain legislative acts of the Russian Federation", which together form the current legal framework for countering corruption crimes committed using digital financial technologies.

The methodology of this study is based on the complex legal nature of corruption crimes and the variety of forms of their manifestation in modern socio-economic conditions and is based on a purposeful combination of complementary scientific methods that provide a comprehensive study of the stated issues. In particular, comparative legal analysis is used to identify regulatory gaps and conflicts in anti-corruption legislation, while the criminalistic approach is aimed at investigating the patterns of evolution and complication of ways to transfer illegal remuneration. The application of a systematic approach, in turn, ensures that bribery is considered not as an isolated criminal act, but as an element of stable corruption links involving a certain subject and an appropriate institutional infrastructure.

Corruption in Russia is considered as a complex socio-legal phenomenon, the counteraction of which, in accordance with the provisions of Federal Law No. 273-FZ of December 25, 2008 "On Combating Corruption", involves the coordinated use of criminal law, criminalistic, organizational, managerial and preventive measures against such forms of illegal behavior as abuse of official authority. or official position, giving and receiving bribes, abuse of authority, commercial bribery and other cases of illegal use of official position contrary to the legitimate interests of society and the state in order to obtain property benefits.

The scientific focus of this study is deliberately limited to the analysis of giving and receiving bribes as the most common and socially dangerous types of corruption crimes, which allows us to consistently and in-depth consider the features of their legal regulation, methods of commission and the specifics of the investigation.

The scientific legal literature consistently holds the thesis that corruption crimes related to giving and receiving bribes, as well as other forms of illegal property remuneration, are among the most socially dangerous acts, since they infringe on the legally established procedure for exercising public authority, violate the principles of legality and accountability of government and undermine trust in institutions. At the same time, the degree of their public danger increases significantly in cases when such acts are committed by officials of public authorities and management ^{[1, p. 85]}.

Of particular importance in modern conditions is the study of corruption crimes in which digital currency is the subject of bribery, which is due to the transformation of financial and economic relations, expressed in the predominance of non-cash payments and a consistent reduction in the sphere of cash circulation, as a result of which both the subject of corruption encroachments and the methods of transferring illegal remuneration change ^{[8, p. 93]}.

The development of information technology and digital financial infrastructure has contributed to the active involvement of digital financial assets and cryptocurrencies in corruption schemes, and the use of cryptocurrencies in settlements between participants in bribery, regardless of the amount of remuneration transferred, objectively increases the public danger of the act, as it often indicates its connection with organized forms of criminal activity and is aimed at concealing the origin and flow of funds.

As D. M. Farakhiev justifiably notes, this category of crimes represents a qualitatively new form of criminal activity in the information and telecommunications space, which has a negative impact on socio-economic, financial and informational public relations ^{[6, p. 214]}.

The widespread use of digital means of payment is associated with technological development, as a result of which, along with publicly recognized payment instruments, cryptocurrency is actively used in financial circulation as a special type of digital money, operating on the basis of distributed registry technologies and issued by private entities outside the central banking system, while the possibility of its free exchange for fiat money at the discretion of holders It significantly complicates the implementation of state financial control and creates additional risks for the anti-corruption system.

The use of cryptocurrencies as a subject of bribery forms a qualitatively new model of illegal wealth enrichment, characterized by high speed of transactions and minimal external surveillance, which significantly complicates the activities of law enforcement agencies at the stages of detection, procedural consolidation and proof of relevant crimes. The difficulties of the investigation are primarily due to the lack of mandatory identification of the owners of cryptocurrency wallets, as a result of which the movement of digital financial assets between them is impersonal, carried out remotely and contactlessly, without the participation of financial intermediaries and without fixing the traditional signs of money turnover, and the subsequent disposal of the received cryptocurrency makes it relatively easy to conceal its criminal origin by converting into fiat money, the acquisition of property or the use of other methods of legalizing criminally obtained income ^{[9, p. 99]}.

An additional factor contributing to the spread of cryptocurrencies in corrupt settlements is the gaps in criminal procedure regulation, expressed in the absence of special procedural mechanisms and technical means to effectively record illegal activities carried out using digital currency, which, combined with the limited control of these assets by state financial and law enforcement institutions, increases their criminogenic attractiveness. These circumstances, as well as the stable connection of cryptocurrency payments with organized forms of criminal activity, make it possible to consider the spread of such methods of transferring illegal remuneration as a serious threat to the crime prevention system, which objectively assigns criminal law science and related branches of legal knowledge the task of comprehensively theoretically understanding the digital transformation of corruption crimes and developing scientifically sound solutions to current problems of law enforcement and investigative practice ^{[10, p. 337]}.

The generalization of judicial and investigative practice in criminal cases of receiving and giving bribes using digital currency indicates the existence of a stable pattern, expressed in the fact that the establishment of the circumstances of such crimes and the formation of an evidence base in most cases are possible only with the active procedural interaction of the preliminary investigation authorities with suspects or accused, as well as the identification of facts. the subsequent conversion of cryptocurrency assets into fiat money and the absence of the ability of persons brought to criminal responsibility to confirm the legitimate origin of the relevant income. At the same time, an analysis of these cases shows that the identification of bribe-givers is often not achieved due to objective difficulties associated with tracking cryptocurrency transactions and establishing the ownership of digital wallets to specific individuals ^{[11, p. 81]}.

These problems are aggravated by the lack of certainty of the legal regulation of the digital currency turnover, the legal nature and legal status of which have not yet been systematically and unambiguously consolidated either in current legislation or in scientific doctrine ^{[5, p. 33]}.

In the absence of a legalized criminal definition, cryptocurrency, functioning as an element of a decentralized payment system, is characterized by the limited and fragmented nature of the legal instruments used, which is due to the uncertainty of its legal regime and objectively creates favorable conditions for the use of digital financial assets in illegal activities, contributing to the spread of crimes committed using cryptocurrency technologies ^{[12, p. 2]}.

Federal Law No. 259-FZ of July 31, 2020 "On Digital Financial Assets, Digital Currency and on Amendments to Certain Legislative Acts of the Russian Federation" establishes the regulatory definition of digital currency as a set of electronic data operating within an information system and offered or accepted as a means of payment or investment instrument, which at the same time They are not recognized as a monetary unit of the Russian Federation, a monetary unit of a foreign state, or an international unit of account and are characterized by the absence of a subject obligated to each holder of such data, with the exception of the operator and nodes of the information system, which are responsible for ensuring that the procedure for issuing said electronic data and making records about them comply with the rules of operation of the relevant information system. All this together allows us to conclude that digital currency is not recognized as an independent object of civil rights and that most decentralized cryptocurrencies do not correspond to the legal definition of digital currency. In addition, the Civil Code of the Russian Federation lacks a special legal concept of digital currency as an object of civil turnover, which entails the emergence of systemic problems of civil regulation of digital currency turnover, which have a direct impact on the criminal qualification of crimes in the field of economic activity and significantly complicate the recognition of digital currency as a subject of criminal encroachment in a number of ways. crimes ^{[13, p. 68]}.

One of the most controversial issues of the criminal assessment of bribery in the context of digitalization is the question of the admissibility of recognizing cryptocurrencies as the subject of a bribe, due to the limited nature of the legal list set out in article 290 of the Criminal Code of the Russian Federation, where money, securities, other property, illegal provision of property services and others are explicitly named as subjects of crime. property rights, in the absence of a direct reference to the digital currency. At the same time, an analysis of law enforcement practice indicates the possibility of an extended interpretation of this rule, since, according to D. A. Stepanenko and Ya.V. Garmyshev, in Resolution No. 24 of the Plenum of the Supreme Court of the Russian Federation dated July 9, 2013, the end time of receiving a bribe is associated with the transfer of electronic funds with the consent of an official to a bank account specified by him or an electronic wallet, which allows us to consider digital forms of value, including cryptocurrency, as potential varieties of the subject of bribery ^{[5, p. 34]}.

The lack of direct regulatory consolidation of the criminal legal status of cryptocurrencies has predetermined the formation of a stable scientific discussion, in which some authors justify the possibility of classifying digital currency as other property, thereby recognizing it as an independent subject of bribery ^{[14, p. 55]}, others propose to qualify its receipt as illegal provision of property services in cases where an official a person gets a real opportunity to dispose of digital assets by converting them or using them for personal interests ^{[15, p. 47]}, whereas a third group of researchers considers cryptocurrency as a type of property rights, which also allows its inclusion in the subject of a bribe, but in a different criminal legal context ^{[16, p. 48]}.

In legal science, along with approaches that allow for an extended interpretation of the subject of a bribe, a critical position is consistently formed regarding the possibility of recognizing cryptocurrencies as such, based on the fact that a bribe as a criminal legal category is a property good subject to mandatory monetary assessment when sentencing, whereas the high volatility of digital currencies, the specifics of their circulation and The lack of a unified mechanism for officially fixing the cost, according to representatives of this field, significantly complicates or excludes the possibility of correctly determining the amount of illegal remuneration in criminal proceedings ^{[17, p. 160]}.

At the same time, D. G. Lisovsky and P. V. Kreer emphasize that the uncertainty of the legal status of cryptocurrencies goes beyond the purely criminal legal issues and acquires systemic importance for the functioning of the financial and economic sphere, since digital currencies have a noticeable impact on the financial market and are characterized by increased vulnerability to use in illegal and fraudulent schemes, which is objectively relevant.There is a need to form a consistent, stable and internally consistent regulatory model of their legal regulation, capable of ensuring the development of innovative financial technologies, protecting the rights of participants in turnover and integrating digital assets into the legal system of the state ^{[18, p. 558]}.

The combination of these circumstances determines the need to rethink traditional criminalistic approaches and methods of investigating corruption crimes committed using digital currency, since effective counteraction to such acts requires a transition from a predominantly reactive model of law enforcement to a proactive one focused on forecasting and early detection of new corruption mechanisms, systematic monitoring of transformations of financial technologies, digital platforms and organizational forms of economic interaction., as well as the integration of classical forensic tools with big data analysis tools and artificial intelligence technologies ^{[19, p. 114]}.

Modern legal doctrine emphasizes that the disclosure and proof of corruption crimes committed using digital technologies largely depends on the timely identification and proper procedural registration of digital traces of illegal activities formed when using computers, mobile devices and other electronic means, in the memory of which information is accumulated reflecting both preparation and implementation. criminal intent. In this regard, the investigator is responsible for a comprehensive and systematic study of the electronic devices that were in the actual possession of the participants in the crime, in order to form a complete, acceptable and sufficient evidence base.

Of particular importance is taking into account the specifics of digital footprints, which are characterized by an increased degree of vulnerability due to the possibility of their rapid destruction, modification or dissemination through various communication channels, which objectively necessitates the immediate conduct of investigative actions, including an inspection of the scene, search and seizure, subject to preliminary tactical training of the investigative task force and the mandatory participation of a specialist, ensuring the correct detection, fixation and withdrawal of digital information ^{[6, p. 115]}.

The inspection of electronic devices makes it possible to establish the nature and content of communications between the payer and the payee, to identify the Internet resources, software and digital services used by them to receive and handle cryptocurrencies, as well as to identify electronic documents and files directly related to criminal activity. In criminal cases in which digital currency is the subject of a bribe, conducting a complex of investigative actions, including inspections of electronic devices and documentation, searches and seizures at the place of work and residence of suspects with the participation of a specialist and the subsequent appointment of computer-technical examinations, should be considered as a necessary condition for the proper establishment of the factual circumstances of the case and ensuring the evidence of the alleged acts ^{[9, p. 100]}.

The scientific and legal doctrine emphasizes that the effectiveness of detecting and documenting corruption crimes committed using digital financial assets crucially depends on the quality of procedural confirmation of the facts of illegal activity at the stage of operational search and subsequent investigative work, primarily by establishing and fixing the identifiers of cryptocurrency wallets involved in the transfer of digital assets to fiat funds, as well as the subsequent movement of these funds to bank accounts and electronic wallets of officials, their close relatives and other affiliated entities that are in a stable factual relationship with the recipient of the bribe, which, together with obtaining information about specific transactions, accounts and financial transactions, makes it possible to reconstruct the complete chain of transfer of illegal remuneration and ensure proper evidentiary support. identified corruption schemes ^{[7, p. 215]}.

At the same time, the digital transformation of corruption crime objectively requires an adequate and symmetrical response from the state, expressed in the introduction of digital tools into the anti-corruption system and the expansion of technological capabilities of law enforcement and control authorities ^{[19, p. 377]}. In this context, the use of distributed registry (blockchain) technologies is of particular importance, representing decentralized accounting systems that ensure transparency, verifiability and immutability of information on the movement of digital assets, which creates real prerequisites for detecting suspicious financial transactions and fixing illegal actions of officials and other participants in corrupt relations ^{[20, p. 44]}. However, this digital tool is not without drawbacks, due to the existence of ways to circumvent the transparency of this tool.

The universal nature of blockchain technologies, confirmed by their applicability in the field of public administration, foreign economic activity, commercial turnover and other areas subject to corruption risks, as well as the expansion of their use reflected in the growth of scientific research and applied projects, allows us to consider combating corruption in the information and telecommunications space using these digital solutions as realistic and an institutionally achievable direction for the development of a modern anti-corruption mechanism.

In the context of digitalization of financial relations and the growth of crimes committed using digital financial and cryptocurrency assets, the introduction of the Transparent Blockchain information and analytical platform by the Federal Financial Monitoring Service in 2021, which functions as a centralized monitoring tool for cryptocurrency transactions and logically correlates with the banking model, has become essential for the system of state financial control. customer identification, providing identification and analysis of suspicious digital asset movement patterns, tracing transaction chains in public blockchain networks, and establishing a link between cryptocurrency addresses and specific identified users. The practical significance of this platform is confirmed by the fact that more than twelve thousand law enforcement officers have been involved in its use since its launch, and since 2023 it has been tested in the activities of credit institutions, which indicates the consistent integration of this tool into the banking system. It is expected that by the end of 2025, the service will become widespread, and most Russian banks will start using it to monitor cryptotransactions.

The functional purpose of the Transparent Blockchain project is primarily to prevent the criminalization of digital financial instruments and increase the effectiveness of detecting and suppressing crimes committed using cryptocurrencies, which corresponds to the priorities of state policy in the field of countering economic and corruption crime. At the same time, the introduction of such high-tech solutions objectively raises the issue of the professional level of law enforcement officers engaged in operational investigative activities in cases of corruption and other economic crimes in the digital environment, since the effective use of such platforms requires officials to have not only legal knowledge, but also special competencies in the field of information and telecommunication technologies, digital payment mechanisms and principles of functioning of distributed registries, without which the full identification, documentation and investigation of relevant crimes is significantly difficult.

Effective implementation of operational investigative activities by law enforcement officers in the investigation of crimes committed using cryptocurrencies involves the formation of a stable system of professional knowledge and skills among these employees based on a thorough knowledge of regulatory legal acts regulating the conduct of operational investigative activities in the information and telecommunications environment, the ability to carry out analytical processing and legally correct interpretation of operationally significant information. information, the availability of special knowledge in the field of digital currency, which together forms the necessary professional and legal basis for the timely detection, proper documentation and effective suppression of corruption and economic crimes in the context of digitalization of financial relations ^{[7, p. 217]}.

The conducted research allows us to substantiate a set of recommendations aimed at improving the effectiveness of countering corruption crimes committed using digital financial and cryptocurrency assets.

First of all, this is the need for a systematic adaptation of anti-corruption legislation to changing socio-economic, financial and technological conditions, which implies a consistent modernization of regulatory legal regulation by including new forms and methods of transferring property values, including digital assets.

It is also an objective necessity to establish a clear and internally consistent legal status of cryptocurrencies, since the lack of a uniform and conceptually structured approach to its legal nature within the framework of legislation on digital financial assets objectively complicates the criminal qualification of acts committed using it.

Effective counteraction to the crimes under investigation is impossible without parallel digitalization of anti-corruption mechanisms, involving the development and implementation of modern information and analytical systems for monitoring digital currency transactions, identifying and recording digital traces of criminal activity, and increasing transparency of financial flows in the digital environment.

One of the most important areas of development of anti-corruption measures in the context of the digital transformation of public space is priority attention to improving the professional training of law enforcement officers engaged in operational search and investigative activities through the formation of their specialized competencies in the field of digital financial technologies and information and telecommunication systems.

There is no doubt that in modern conditions, an effective fight against corruption related to the use of cryptocurrencies is possible only with the integrated and coordinated application of criminal law, organizational, technical and preventive measures.

The article is published in its final version as approved following the last positive peer review recommending acceptance for publication. It incorporates revisions made by the author in response to prior negative peer review reports that did not recommend publication. All peer review reports, including initial negative reviews, are published in open access alongside the article. All versions of the author’s revisions are archived in the publisher’s repository and may be made available upon reasonable request in accordance with Elsevier’s editorial policies and applicable data availability requirements.
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