Risk! The latest crime of virtual currency emerges

The cryptocurrency world has been in turmoil these days, and fear often comes from the unknown. We have observed that the crime of concealing criminal proceeds has become a "new favorite" recently. To answer questions and resolve doubts, the Sajie team wrote this article in the hope of popularizing the law for all old friends.

01

The criminal composition of the crime of concealing the proceeds of crime

According to Article 312 of the Criminal Law, the compliance with the elements of the crime of concealing and concealing the proceeds of crime covers two key points: one is whether the perpetrator is aware that the proceeds are proceeds of crime; the other is whether any actions have been taken to conceal the proceeds.

As for the identification standard of "knowingly", the relevant laws and regulations have not made a direct explanation. The Sister Sa team believes that it can refer to the provisions of the judicial interpretation of money laundering: it should be determined based on subjective and objective factors such as the perpetrator's cognitive ability, the situation of contact with other people's criminal proceeds and their proceeds, the type and amount of criminal proceeds and their proceeds, the conversion and transfer methods of criminal proceeds and their proceeds, and the defendant's confession. In judicial practice, there is a possibility of presuming "knowingly" based on the above circumstances.

Regarding the criminal standards for concealing and concealing acts, combined with the provisions of the "Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in Handling Criminal Cases of Concealing and Hiding Criminal Proceeds and Proceeds from Criminal Proceeds", there are mainly the following four situations: First, the value of concealing and concealing criminal proceeds and the proceeds generated by them reaches a certain standard; second, a person has been administratively punished for concealing and concealing criminal proceeds within one year and commits the crime again; third, the concealed and concealed criminal proceeds are funds or property related to the public interest; and fourth, the behavior prevents the upstream crime from being investigated and the behavior makes it impossible to detect the upstream crime and the loss is irreparable.

02

The connection between the cryptocurrency industry and the crime

Based on the types of cryptocurrency business that our team understands, we believe that the connection between the cryptocurrency industry and the crime of concealing criminal proceeds is mainly reflected in two aspects:

1. The perpetrators of upstream crimes take advantage of the anonymous and decentralized nature of the cryptocurrency world and use the proceeds from the crime to invest in private placements in the cryptocurrency world, thereby exchanging them for various virtual currencies with legal currency value and transferring their property overseas.

2. Many cryptocurrency platforms provide services for exchanging fiat currency with virtual currency, or provide services for introducing platforms for exchanging fiat currency with virtual currency. The former is illegal payment and settlement business and is suspected of illegal business operation, while the latter may constitute an accomplice in concealing the proceeds of crime.

Some friends in the cryptocurrency circle have made such a wrong judgment: there is no possibility that the project party or platform party knows the source of funds, and there is no subjective element of "knowingly" concealing the proceeds of crime.

However, as mentioned above, when judging the subjective element, the judicial authorities will make a comprehensive judgment based on the obligations and cognitive ability of the project party or platform party. Although there is no private placement business guidance in the securities industry, the Sister Sa team believes that when raising funds, the project party or platform party has at least the obligation to review the legal source of the funds it receives, that is, anti-money laundering business. When such obligations are not fulfilled, the project party or platform party has a high legal risk of being presumed to be "knowingly" by the judicial authorities.

03

Extension and expansion

The main difference between the crime of concealing criminal proceeds and the crime of money laundering in terms of criminal composition lies in whether the type of upstream crime is limited.

When the upstream crime is a drug crime, organized crime of a mafia nature, terrorist crime, smuggling crime, corruption and bribery crime, crime of disrupting financial management order, or financial fraud crime, the project party or platform party in the cryptocurrency circle may also constitute money laundering and bear more serious imprisonment.

04

Final Thoughts

We know that the tool is innocent, but if the tool is repeatedly used for crimes, society's tolerance for the tool will decrease, and the scope of supervision will be further limited. For the healthy development of the currency circle, the Sister Sa team hopes that all private equity entities will introduce the concept of "qualified investors", do a good job of compliance, and stay away from criminal legal risks.