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The Russian Supreme Court overturned the acquittal verdict in a case involving the legalization of Bitcoins obtained from illicit drug production. They deemed the defendant’s financial transactions as an attempt to legitimize the possession of illegally converted cryptocurrency. The case has been sent for reconsideration to the Ryazan regional court.
The defendant was involved in the large-scale storage and production of mephedrone, receiving payment in Bitcoins and converting them into rubles to transfer them to his roommate’s daughter’s cards and accounts. The total amount of funds introduced into legal circulation exceeded 8 million rubles.
While the defendant was initially found guilty of drug trafficking, he was acquitted of money laundering, with the court considering Bitcoin cashing as not constituting money laundering.
Cryptocurrency Concealment and Legalization: Russian Supreme Court’s Ruling and Expert Insights
The deputy prosecutor appealed the verdict, arguing that the defendant intentionally concealed the connection between the funds and their criminal origin by utilizing banking technologies to avoid detection. Reference was made to the Supreme Court’s recognition of cryptocurrency as a subject of crimes under the Criminal Code.
The Russian Supreme Court upheld the appeal and revoked the acquittal verdict regarding the charge of legalization. They clarified that the offense does not require the mandatory involvement of legalized money in economic circulation, but rather focuses on establishing financial transactions aimed at providing a legitimate appearance of possessing money or other assets.
Criminal law expert Andrey Tuzov highlighted that despite the uncertain legal status of cryptocurrency in Russia, courts already recognize it as a form of payment and property, particularly in criminal cases. Tuzov predicts that through court precedents in money laundering cases, there will be a definitive understanding that cryptocurrency is indeed property and can be used in various transactions.