Fraud in business: types, methods, responsibility, defense by a lawyer

17.08.2019

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Fraud means the theft of property, the acquisition of rights to it through deception. Business fraud usually means failure to fulfill obligations under a contract for the provision of services or the supply of goods, and intentionally. As a result of deception, the recipient of services or the buyer loses money and property.

Corpus delicti

According to the mentioned paragraphs of Article 159, the object of the crime is the contractual relations of the parties who entered into a transaction. The role of the subject is played by the entrepreneur, the organization.

The objective side of the crime committed is the fact of non-fulfillment of agreements, and the subjective side is the direct intent that initially arose on the part of the guilty party.

To initiate criminal prosecution, you must first prove the presence of deliberate intent to commit fraudulent acts. Additionally, the following conditions must be met:

The defendant must be over 18 years of age;
The accused must be officially registered as an individual entrepreneur or hold the position of head of a company/organization with the authority to enter into transactions;
The applicant must have a legal cooperation agreement;
The court must be provided with documents confirming the failure of the potential culprit to fulfill the agreement.

Legal proceedings can be initiated against an individual who is in a management position, as well as against a member of the company's management.

Litigation on credit card fraud

FIRST CASSATION COURT OF GENERAL JURISDICTION

DEFINITION

dated March 12, 2022 N 77-263/2020

The Judicial Collegium for Criminal Cases of the First Cassation Court of General Jurisdiction, consisting of:

presiding Kuzmina O.N.,

judges: Kotlova A.E. and Peregudova A.Yu.,

under secretary P.,

with:

Prosecutor Khristisenko P.G.,

the defender of the convicted K. - lawyer Belova O.R., who presented certificate N from DD.MM.YYYY and warrant N from DD.MM.YYYY,

examined in open court a criminal case on the cassation submission of the Deputy Prosecutor of the Nizhny Novgorod Region Zhilyakov K.Yu. and the cassation appeal of the defender of the convicted K. - lawyer I.V. Mezhevov. against the verdict of the magistrate of the judicial district of the Pervomaisky judicial district of the Nizhny Novgorod region dated October 25, 2022 and the appeal decision of the Pervomaisky district court of the Nizhny Novgorod region dated December 11, 2022.

By the verdict of the magistrate of the judicial district of the Pervomaisky judicial district of the Nizhny Novgorod region dated October 25, 2022

K., born DD.MM.YYYY in <address>, registered at: <address>, residing at: <address>, working <data taken>, with secondary specialized education, divorced, unconvicted,

convicted under Part 1 of Art. 159 of the Criminal Code of the Russian Federation to 300 hours of compulsory work.

The question of the fate of the material evidence has been resolved.

By the appeal ruling of the Pervomaisky District Court of the Nizhny Novgorod Region dated December 11, 2022, the above verdict of the magistrate was left unchanged.

In the cassation submission, Deputy Prosecutor of the Nizhny Novgorod Region Zhilyakov K.Yu. expresses disagreement with court decisions. Claims that the courts of the first and appellate instances did not reliably establish K.’s direct intent to steal funds <data taken> when concluding a loan agreement, taking into account the convict’s employment, earnings and car. Draws attention to contradictions in court decisions, including in the description of the method of K. committing a crime, as well as in the conclusions of the courts and the evidence provided. He asks that the court decisions be quashed and that the case be remitted for a new trial.

Lawyer I.V. Mezhevov in the cassation appeal filed in defense of the convicted K., he also expresses disagreement with court decisions. According to the defense lawyer, the court's conclusions set out in the verdict do not correspond to the actual circumstances of the case and are not confirmed by the evidence examined at the court hearing. Referring to Resolution of the Plenum of the Supreme Court of the Russian Federation dated November 30, 2022 N 48 “On judicial practice in cases of fraud, misappropriation and embezzlement”, he asserts that K. has no intent to steal funds, that is, a deliberate failure to fulfill obligations to repay the loan taken . Draws attention to the fact that K. at the time of receiving the loan had a place of work and income, as well as owned a car, the cost of which exceeded the loan amount. Indicates that the loan repayment period under the agreement was set on demand; until April 2022, the bank did not receive a request to repay the loan to K. Indicates a violation of the rights of the convicted person, since when replacing the state prosecutor, the right to challenge by the magistrate was not explained. He believes that the appellate court treated the consideration of his appeal formally. He asks the court decisions to be canceled and the criminal case against K. to be terminated due to the lack of corpus delicti in his actions.

Having heard the report of judge A.E. Kotlov, who outlined the content of court decisions, the arguments of cassation submissions and complaints, the speech of prosecutor P.G. Khristisenko. and defender Belova O.R., who supported the arguments of the cassation presentation and complaint and the cancellation of court decisions, judicial panel

installed:

By the verdict of the magistrate, K. was found guilty of committing fraud, that is, theft of someone else's property through abuse of trust, under the following circumstances.

November 3, 2022 at <data seized> at the address: <address>, K. for the purpose of stealing funds <data seized> by misleading the victim about his true intentions, knowing that he could not return and not wanting to return funds, received a bank card with a debt limit of 45,000 rubles under agreement N, which he disposed of at his own discretion, causing <data taken> damage in the amount of 46,554 rubles 88 kopecks.

At the same time, having checked the materials of the criminal case, having discussed the arguments of the cassation appeal and presentation, the judicial panel comes to the following conclusion.

In accordance with Part 1 of Art. 401.15 of the Code of Criminal Procedure of the Russian Federation, the grounds for canceling or changing a sentence, ruling or court decision when considering a criminal case in cassation are significant violations of the criminal and (or) criminal procedure law that influenced the outcome of the case.

Such violations were committed in this criminal case.

By virtue of Art. 297 of the Code of Criminal Procedure of the Russian Federation, a court verdict must be legal, reasonable, fair and is recognized as such if it is decided in accordance with the requirements of the criminal procedure law and is based on the correct application of the criminal law.

According to Part 4 of Art. 302 of the Code of Criminal Procedure of the Russian Federation, a conviction cannot be based on assumptions and is decided only on the condition that during the trial the defendant’s guilt in committing a crime is confirmed by the totality of evidence examined by the court.

However, when deciding to convict K. under Part 1 of Art. 159 of the Criminal Code of the Russian Federation, the magistrate left without proper assessment a number of significant circumstances indicating the innocence of the convicted person.

The subjective side of the crime provided for in Part 1 of Art. 159 of the Criminal Code of the Russian Federation, is characterized by the presence of direct intent to steal.

As the Plenum of the Supreme Court of the Russian Federation explained in paragraph 4 of Resolution No. 48 of November 30, 2022 “On judicial practice in cases of fraud, misappropriation and embezzlement,” the presence of such intent can be evidenced, in particular, by the person’s deliberate lack of real opportunity to fulfill the obligation in accordance with the terms of the agreement, the use by a person of forged documents when concluding an agreement, including identification documents, statutory documents, letters of guarantee, certificates, the person’s concealment of information about the existence of debts and pledges of property, the disposal of received property for personal purposes contrary to the terms of the agreement and other. Courts should take into account that these circumstances in themselves cannot prejudge the court’s conclusions about a person’s guilt in committing fraud. In each specific case, it is necessary, taking into account all the circumstances of the case, to establish that the person obviously did not intend to fulfill his obligations.

From the materials of the criminal case, it is clear that K. throughout the entire proceedings in the case consistently asserted that he had no intention to steal the bank’s funds received in the form of a loan, due to his earnings and property, the value of which exceeds the amount of the loan, however This argument of the convicted person was rejected by the magistrate.

Justifying K.'s intent to steal funds <data taken> the magistrate in the verdict referred to the fact that from the moment of concluding the loan agreement and after using the loan funds, the convict had no real opportunity to fulfill his obligations to the bank, he had no intention this should be done before a procedural check was initiated against him by law enforcement officers at the request of the victim, and the repayment of credit debt after the initiation of a criminal case was forced to compensate for the damage caused by the crime.

In support of the conclusion about K.’s guilt, the magistrate in the verdict referred to the testimony of the victim’s representative, witnesses and case materials, which testify only to the convict’s conclusion of a loan agreement, his financial situation and personal information.

The appellate court also agreed with the magistrate’s verdict regarding K., essentially copying its contents into the appellate decision.

At the same time, the magistrate and the court of appeal did not take into account that, according to the individual terms of the consumer loan agreement N, concluded on November 3, 2022 between K. and <data taken>, the validity period of this agreement and the loan repayment period are determined “On demand”, which is At the time of the conclusion of the contract, the convict was working, had an income and a car, the cost of which significantly exceeds the loan amount.

From the case materials it follows that in order to conclude an agreement to receive a loan, K. was presented with a passport and reliable information about the place of registration and work, Tinkoff Bank JSC did not directly contact K. with a demand for repayment of the loan, and after the victim applied to police department, which became known to the convict, K. fully fulfilled his obligations under the contract, reimbursed the loan received with all additional payments, and therefore the bank has no claims against him.

However, the above information, in violation of Art. Art. 87 and 88 of the Code of Criminal Procedure of the Russian Federation, did not receive proper assessment in the courts of first and appellate instances.

Under such obvious circumstances, the judicial panel finds convincing the arguments of the cassation presentation and complaint that the conclusions of the magistrate and the appellate court about K.’s intent to steal funds <data taken> by fraud are based on assumptions and are not confirmed by those examined in court meeting with evidence, in connection with which, on the basis of clause 2 of part 1 of Art. 24 and paragraph 2, part 1, art. 401.14 of the Code of Criminal Procedure of the Russian Federation, the verdict of the magistrate and the appeal decision are subject to cancellation, the criminal case against K. - to be terminated due to the absence of corpus delicti in his actions, provided for in Part 1 of Art. 159 of the Criminal Code of the Russian Federation, with recognition of his right to rehabilitation.

Based on the above, guided by art. 401.14 and 401.15 of the Code of Criminal Procedure of the Russian Federation, the judicial panel determined:

cassation submission of the Deputy Prosecutor of the Nizhny Novgorod Region Zhilyakov K.Yu. and the cassation appeal of the defender of the convicted K. - lawyer I.V. Mezhevov. and satisfy.

The verdict of the magistrate of the judicial district of the Pervomaisky judicial district of the Nizhny Novgorod region dated October 25, 2022 and the appeal ruling of the Pervomaisky district court of the Nizhny Novgorod region dated December 11, 2022 in relation to K. are cancelled.

The criminal case against K. is terminated on the basis of clause 2 of part 1 of Art. 24 of the Code of Criminal Procedure of the Russian Federation for the absence in his actions of the corpus delicti provided for in Part 1 of Art. 159 of the Criminal Code of the Russian Federation.

Based on Art. 133 of the Code of Criminal Procedure of the Russian Federation recognizes K.’s right to rehabilitation.

Types and methods of fraud in business

In addition to failure to fulfill the terms of the contract, there are other criminal acts that constitute business fraud:

Excess of official authority, deliberate overestimation of the functions of the organization by its leader. This includes entering into transactions that exceed the limits for a particular position.
Signing contracts that contradict Russian legislation. Such transactions are declared invalid, and everything received by the fraudsters through them is collected by the state or returned to the injured party.
Attribution of services that were not actually provided or received by the counterparty. Traditionally, for this purpose, fake payment documents are used.
Issuing loans with hidden fees written in the smallest, almost inaccessible font.
Execution of loans secured by company property by a person who does not have the right to do so. Such a transaction becomes invalid.

When failure to perform an obligation is fraud

Fraud, committed, as follows from the wording of Article 159 of the Criminal Code of the Russian Federation, using deception or abuse of trust, is closely related to civil law relations. In some situations, especially in cases of fraud in business activities, it is almost impossible to distinguish between the criminal and civil spheres of relations. The decision of the arbitration court will have evidentiary force in the investigation of a criminal case; the court verdict may be the main evidence in subsequent compensation for damage caused by the crime.

However, not every violation of a contractual obligation is considered fraud. Clause 4 of the Resolution of the Plenum of the Supreme Court of the Russian Federation dated November 30, 2017 No. 48 “On judicial practice in cases of fraud, misappropriation and embezzlement” states that the actions of a person are qualified as fraud only in cases where the person intends to fail to fulfill obligations or misappropriate someone else’s property in advance, that is, before the obligation arises.

In this regard, certain difficulties arise: the intent of a person, his thoughts are quite difficult to prove. Often, proof of intent is based on external signs of the act, indirectly confirming the person’s intention to fraudulently take possession of someone else’s property or money. Typical external signs on the basis of which the court can draw a conclusion about the criminal intent of a person have been developed for a long time by judicial practice. Thus, the presence of intent could be evidenced by the perpetrators’ deliberate lack of real ability to fulfill obligations, falsification of documents, conducting business through “fly-by-night companies,” and failure to repay debts on the claims of victims (Determination of the Supreme Court of the Russian Federation dated September 15, 2009 in case No. 48-009-81 ). Subsequently, these signs were enshrined in the Resolution of the Plenum of the Supreme Court of the Russian Federation dated November 30, 2017 No. 48, but were added: concealment by a person of information about the existence of debts and encumbrances of property, disposal of received property for personal purposes contrary to the terms of the contract. The list is non-exhaustive.

However, even the presence of these formal signs does not indicate that a person has committed fraud. Thus, if a significant part of the contractual obligations were actually fulfilled, the person’s actions are qualified only as a violation of civil obligations (sentence of the Kovrov City Court of the Vladimir Region dated January 10, 2013 No. 1-2013-11).

Another element of the crime is closely related to fraud - arbitrariness (Article 330 of the Criminal Code of the Russian Federation). They are recognized as causing damage through the exercise of an actual or perceived right. In this case, the person also has selfish intent, but he has any legal grounds for the seizure or disposal of property. Since the grounds for taking possession of property existed, arbitrariness is not recognized as theft, like fraud and theft. Arbitrariness does not encroach on property, but on the order of management.

Arbitrariness also differs from fraud in that the intent to misappropriate property arises after the appearance of real or alleged grounds for appropriating this property.

An example of arbitrariness can be the unauthorized disposal of pledged property if, by virtue of the law, foreclosure on this property is carried out in court (clause 26 of the Resolution of the Plenum of the Supreme Court of the Russian Federation of November 30, 2017 No. 48) or the unauthorized seizure of another person’s car for the fact that it burned the culprit’s car, etc. (Appeal ruling of the Supreme Court of the Russian Federation dated January 14, 2020 No. 19-APU 19-16).

In any case, when considering the case, the court must find out whether the person had selfish intent and any legal basis to appropriate someone else’s property. If a person’s actions were incorrectly classified as fraud, the criminal case must be returned to the prosecutor (Appeal Resolution of the Moscow City Court dated June 24, 2019).

Sincerely, lawyer Anatoly Antonov, managing partner of the law firm Antonov and Partners.

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Help from a lawyer

Since the described acts fall under the category of criminal cases, either party requires competent protection of rights and interests. An experienced lawyer with a narrow specialization will help build an effective defense/prosecution strategy to prove the guilt of the defendant or the innocence of the accused. Legal support includes:

Preparation of documents;
Collection of evidence according to the intricacies of the current situation;
Drawing up petitions to various authorities;
Representation of client interests at court hearings;
Monitoring the actions of officials and filing complaints if necessary;
Consultations on the case throughout the proceedings.

By enlisting the support of a professional, you will increase the chances of a positive outcome. A lawyer will help defend the rights of an entrepreneur and maintain a positive business reputation.

In the acquittal, the court distinguished between fraud and violation of public procurement legislation

On August 2, the Dzerzhinsky District Court of St. Petersburg acquitted the former general director of the Leningrad Regional Television Company, Andrei Mokrov. The prosecution insisted that he fraudulently stole almost 6 million rubles of budget funds.

Facts established by the court

In 2014, Andrey Mokrov held the position of General Director of the Leningrad Regional Television Company, which previously actively collaborated with the Health Committee of the Leningrad Region.

The committee received a subsidy of about 8 million rubles to implement activities aimed at promoting a healthy lifestyle among the population. In this regard, he needed a service for the production and broadcasting of video materials related to the prevention of socially significant diseases. The committee and the television company were interested in concluding a corresponding government contract between them. However, the public procurement procedure is regulated in detail by law, which did not allow the customer to arbitrarily choose a contractor.

The general director of the television company took a number of actions in order to conclude an agreement with the Committee. These actions, according to the court, clearly violated the laws on public procurement and competition protection. As stated in the verdict, Mokrov knew that to form the initial contract price, at least three price offers from different market participants were necessary. At his request, the television company employees prepared the necessary documents from their organization, as well as from two others. The court subsequently found that the signatures on documents from two other organizations were forged.

To ensure the auction, Andrey Mokrov also asked the head of MEDIA.S-Pb to submit an application for participation. This organization did not have the technical ability to provide services under the government contract in full. As the court indicated, if MEDIA.S-Pb won, Mokrov was going to ensure the distribution of video materials on air through his television company on the basis of a subcontract.

Even before the auction, the general director of LOT agreed on the production of video materials by FortMedia under a government contract for 2 million rubles. The reason for attracting a third party was due to the fact that Mokrov’s company was very busy before the New Year.

In December 2014, the television company and the Health Committee entered into a corresponding agreement. LOT fulfilled its obligations and received a payment of about 8 million rubles.

Prosecution position

The investigation proceeded from the fact that the actions of the general director of the Leningrad Regional Television Company were aimed at stealing budget funds. Therefore, it proposed to qualify the act of Andrei Mokrov under Part 4 of Art. 159 of the Criminal Code as fraud committed with the use of official position on an especially large scale.

Explaining the qualification assigned to the act, the assistant prosecutor indicated that Andrei Mokrov had knowledge and experience in the field of production and release of media products. In addition, he knew that the maximum starting contract price would be calculated by the Committee staff using the comparable market price method based on the price information provided. Therefore, he instructed his deputy for finance to prepare price proposals on behalf of their organization, as well as from two other organizations, and send them to the Committee.

According to the prosecution, these documents included deliberately false information regarding the cost of services. At the direction of the manager, an employee of the television company significantly inflated the amounts several times. The purpose of this was to artificially increase the initial contract price. At the same time, Mokrov made sure that the price of his television company was the most favorable. Since the Committee employees relied on the reliability of the documents presented, they determined the initial maximum contract price of almost 8 million rubles.

The prosecution believed that Mokrov embezzled almost 6 million rubles of budget funds, since the services for producing video materials cost only 2 million. Determining the fate of the stolen money, the assistant prosecutor indicated that the accountant of the television company, on Mokrov’s orders, transferred almost 4 million rubles to the account of "one-day" Andrei Mokrov, according to the prosecution, used the remaining 2 million in the business activities of his legal entity.

Defense position

The interests of Andrei Mokrov were represented by the President of the Baltic Bar Association named after. Anatoly Sobchak, vice-president of the St. Petersburg AP Yuri Novolodsky and lawyer of the Baltic Bar Association named after. Anatoly Sobchak Mark Pavlov.

First of all, the defense attorneys convinced the court that the cost of the service under the government contract performed by LOT included not only the cost of producing the videos (as the prosecution argued), but also the cost of distributing the videos on air on the TV channel. At the same time, the defense presented a number of evidence confirming the compliance of the price of the government contract with market prices that existed in 2014. In particular, the defenders referred to the draft terms of reference, which was prepared by an economist from the Vyborg Interdistrict Narcological Dispensary, one of the recipients of services under the government contract, back in the summer of 2014, that is, before the auction.

The defense drew the court's attention to an order in force in 2014 at the Leningrad Regional Television Company, according to which the distribution of advertising materials cost 15 thousand rubles. in 1 minute. That is, Mark Pavlov emphasized, just broadcasting videos under government orders cost more than 6 million rubles. At the same time, the television company paid another 2 million for the production of these materials. The lawyers also presented documents to the court, from which it followed that the cost of services under the government contract, according to people working in this area, should have been about 9-11 million rubles.

According to the defense, the prosecution did not prove the fact that Andrei Mokrov reliably knew how the initial maximum price of the contract would be determined by the Committee’s employees. During the judicial investigation, it was established that the general director of the television company did not influence this process in any way.

The lawyers did not agree that almost 4 million were transferred to Build-Master in order to “create the appearance of costs incurred.” They indicated that the services under the contract had already been provided, and the government customer accepted them without any complaints. In the future, the television company did not have to report to the Committee on how it spent the funds received. Therefore, according to the defense, Andrei Mokrov did not need to justify the allocation of the corresponding amount to pay for certain services.

Referring to a number of evidence, the lawyers refuted the prosecution’s reference to the involvement of MEDIA.S-Pb to participate in the auction. The defense pointed out that this made no sense, since according to the law, even as the only participant in the auction, the television company had the right to receive the corresponding government order.

The court acquitted Andrei Mokrov

The Dzerzhinsky District Court of St. Petersburg considered it proven that Andrei Mokrov violated the laws on public procurement and freedom of competition, as well as financial discipline. However, according to the court, these violations do not indicate that the general director of the television company stole budget funds.

The prosecution insisted that the television company had to broadcast videos under a government contract for free, since the channel was financed by the Leningrad Region. The court rejected these arguments. In his opinion, budget subsidization of most of LOT's costs for broadcasting materials on television did not interfere with the television company's business activities, including the conclusion of government contracts. “Subsidizing the broadcast of a TV channel at the expense of the state and the entrepreneurial activity of a legal entity - the owner of the media are not mutually exclusive concepts,” the Dzherzhinsky District Court emphasized.

The court concluded that Andrey Mokrov’s falsification of price proposals on behalf of two other companies was not aimed at inflating the initial maximum contract price. The first instance decided that the general director of the television company thereby wanted to bypass the legislation on public procurement and protection of competition in order to ensure the unhindered conduct of the competition within the amount of money allocated from the budget and the participation of LOT in it. That is why, according to the court, Andrei Mokrov turned to his friend, who headed MEDIA.S-Pb.

Regarding the arguments of the state prosecution about the illegal transfer of money in favor of Build-Master, the court indicated that Mokrov had not been charged with it, therefore it is impossible to consider such an issue in this case.

The first instance recalled that the mandatory signs of fraud are the gratuitous seizure of property, deception of the victim and causing damage to him. According to the court, during the consideration of the case, it was reliably established that Andrei Mokrov did not mislead the Health Committee of the Leningrad Region regarding the market value of work and services for the production and distribution of video materials. The prices proposed by the general director of the television company on behalf of her and two others corresponded to the market prices. Both the initial maximum price and the final contract price were adequate. In turn, the payment received by LOT corresponded to the work performed and services provided.

Based on this, the court decided that Andrei Mokrov did not commit fraud and issued an acquittal.

Comments from lawyers after acquittal

Both defense attorneys called Mokrov’s case “custom-made.”

“It is obvious that the Health Committee did not intend to pursue Mokrov, because it was satisfied with the service received and had no complaints. The initiators of the criminal prosecution understood that for the purity of the case there must be a victim in it. That is why both a formal statement of crime and a formal statement of claim appeared in the case materials, the purpose of which was to create the appearance of legality of the persecution, and not the desire to protect and restore someone’s rights,” said Mark Pavlov.

The lawyer pointed out that this case is an example of unacceptable interference of the law enforcement system in the civil relations of entrepreneurs. In his opinion, operatives and investigators demonstrated “complete ignorance of civil law and legislation governing public procurement.”

Mark Pavlov spoke about the key points that led the case to success: “This is complete confidence in the innocence of the client, a painstaking analysis of the charges brought against him and a consistent evidentiary refutation of all theses of the charges. In addition, on our advice, Andrei Mokrov testified throughout the entire judicial investigation, expressing his attitude to the evidence presented, thanks to which both the position of the prosecution and the position of the defense were always in the court’s field of view,” the lawyer said.

Commenting on the acquittal, Yuri Novolodsky said that “one should never be in captivity of examinations.” He pointed out that in this case the lawyers found a number of shortcomings in the forensic economic examination carried out at the initiative of the prosecution. In order to prove its position, the defense received two expert opinions. One of them was an audit. The second revealed complex issues of government procurement legislation and was received from Oleg Kolomoichenko, Honored Economist of Russia and ex-head of the Federal Antimonopoly Service for St. Petersburg.

Defense attorneys reported that the prosecutor's office filed an appeal. Yuri Novolodsky believes that the acquittal will not be overturned, since Andrei Mokrov is obviously innocent.

Question answer

Question 1. How to prove intentionality of actions?

Answer: The first step is to conduct a thorough audit of the financial and permitting documents of the company or individual entrepreneur. The texts of agreements and contracts must contain indications that the obligations undertaken are unreasonable, as well as other evidence confirming the presence of intent to cause damage to the other party. Evidence of the availability of resource/technical capabilities to fulfill the terms of the contract, or of the company’s experience in conducting similar transactions previously, will help prove intentionality.

Question 2. Which persons can be held criminally liable for fraudulent activities in business?

Answer: Firstly, the defendant must have the status of an individual entrepreneur. It may also be a manager or member of the company's management board, or a person holding the position of general or executive director.

Question 3. Is partial fulfillment of obligations an argument about the absence of corpus delicti?

Answer: In judicial practice, partial fulfillment of obligations under a transaction is most often considered not as evidence of a lack of intent to cause damage, but as an attempt to convince the other party of a good faith intention to fulfill its obligations in full. Typically, evidence of such behavior is provided by documents confirming that the perpetrators deliberately stopped any actions under the contract after fulfilling part of the obligations without good reason.

Ask your question to a lawyer using the feedback form below or in the comments to this article.

Authors:

Lawyer Alexey Krasnov

Lawyer Alexander Gerasin

Related service:

The information was prepared based on the provisions of legislation and judicial practice as of 08/17/2019

The practice of applying Article 159 of the Criminal Code of the Russian Federation in 2022 in relation to entrepreneurs

Fraud continues to be a “favorite” article of law enforcement, since its wording makes it possible to declare virtually any transaction and even a banal failure to fulfill the terms of a contract a crime. In the first half of 2022, according to the Prosecutor General’s Office, 194.8 thousand cases of fraud were registered: the increase, compared to the same period in 2022, was 6 thousand.

The pressure on entrepreneurs increases every year. This is evidenced, in particular, by the increasing number of cases of businessmen turning to the Commissioner for the Protection of the Rights of Entrepreneurs with complaints about illegal criminal prosecution. For example, if in 2015 there were just under 2,000 such requests, then in 2022 there are already more than 10,000. Moreover, more than half of the entrepreneurs who applied in connection with criminal prosecution were held accountable specifically for fraud. This information is contained in the report of business ombudsman Boris Titov.

In most cases, the reason for initiating criminal cases was conflicts with other entrepreneurs, as well as personal interests of law enforcement officers.

Let's look at several interesting criminal cases that had a wide public response in 2022.

In October of this year, the Saratov Regional Court considered the appeal of the prosecutor's office against the acquittal pronounced against the ex-deputy of the regional Duma and director of Avtokombinat-2 JSC Andrei Belikov. He was accused of fraud on an especially large scale and commercial bribery (Part 4 of Article 159 of the Criminal Code of the Russian Federation, Part 8 of Article 204 of the Criminal Code of the Russian Federation).
According to investigators, from 2014 to 2022, Belikov fraudulently received 7 million rubles to reimburse the costs of transporting preferential passengers. The investigation also believed that the accused, for 5 million rubles, illegally provided access to several individual entrepreneurs to carry out passenger transportation.
The court of first instance found that the acts accused of Belikov were of a civil nature; accordingly, the injured party had to resolve the conflict through arbitration proceedings. The regional court agreed with these arguments, upholding the acquittal with the right to rehabilitation.

And another example of an acquittal.

In 2022, a criminal case was opened against Pavel Chernyavsky, the manager of the Siberian branch of Pushkino Bank, for fraud and money laundering. According to investigators, Chernyavsky, who was the head of the company, helped a legal entity obtain a loan from Pushkino Bank for the construction of a multi-story building. However, loan funds in the amount of 252 million rubles were spent on other purposes.
Due to the fact that the applicant, on whose testimony the entire prosecution was based, refused the initial testimony incriminating the defendant, the Zheleznodorozhny District Court of Novosibirsk issued an acquittal with the right to rehabilitation. However, Pavel Chernyavsky spent about 3 years in custody.

Of course, the two cases with acquittals discussed above are the exception rather than the rule. In most cases, the courts side with the prosecution and issue guilty verdicts.

In August of this year, the Murom City Court issued a guilty verdict against an entrepreneur accused of fraud. According to the case materials, the businessman asked his employees to apply for loans and transfer the money to him, allegedly to replenish working capital. In total, employees received loans in the amount of more than 6 million rubles.
At first, the businessman made loan payments, then, due to the financial crisis, he stopped doing so. The court found the man guilty of fraud and sentenced him to 5 years in a general regime colony. In addition, the entrepreneur must compensate the victims for the damage caused.

A very illustrative example of bringing an entrepreneur to criminal liability under Art. 159 of the Criminal Code of the Russian Federation for violation of the terms of the transaction is a criminal case against the well-known developer of the city of Sochi, Shapranov V.I.

The Adler District Court of Sochi has been hearing for the second year a criminal case against the director of YUSIK LLC, who, under agreements between the organization and the victims, received money from the latter. The organization fulfilled its obligations to the shareholders, built a residential building, and the victims registered ownership of the residential premises. However, for formal reasons, the developer was unable to timely connect the house to communications, which led to the initiation of a criminal case against him under Art. 159 of the Criminal Code of the Russian Federation. The position of the victims, supported by the investigation, is surprising, in which they received housing, although not connected to communications, but demanded that Shapranov pay them money in full. That is, they received the apartments and want to return the money. Shapranov himself, who has been in custody for three years, meanwhile initiated all the necessary procedures to connect the house to communications. It should also be noted that all the episodes incriminated against the accused against shareholders were committed during the period of validity of Art. 159.4 of the Criminal Code of the Russian Federation, which is not taken into account by the prosecution for obvious reasons: the statute of limitations for criminal prosecution in the event of reclassification has expired and the defendant will have to be released from liability.

Quite often, criminal cases brought against entrepreneurs do not reach the court. Here is one such example.

One of the Moscow region developers purchased a plot in the Istra district for 500 million rubles. This amount had to be paid in stages. However, a dispute arose between the parties to the transaction; the buyer and seller did not fulfill their obligations. A criminal case against the head of a construction company was initiated in 2022, but after the intervention of the Commissioner for the Protection of the Rights of Entrepreneurs in the Moscow Region and the Moscow Region Prosecutor's Office, it was terminated due to the lack of corpus delicti .
The competent authorities established the fact of the groundless transfer of civil law relations to the legal plane, as well as obstruction of business activities.

Trying to bring entrepreneurs to criminal liability under Art. 159 of the Criminal Code of the Russian Federation, investigative authorities commit deliberate violations. Problems for those accused under Art. 159 of the Criminal Code of the Russian Federation for entrepreneurs begins already when a criminal case is initiated. Often, even if it is confirmed that a crime has been committed in the sphere of entrepreneurial activity, investigators categorically assert the opposite and attract entrepreneurs under the CC. 1-4 tbsp. 159 of the Criminal Code of the Russian Federation in order to circumvent the law prohibiting the imprisonment of entrepreneurs. Also, quite often, any actions committed by deception are interpreted as fraud, even in the absence of signs of theft, for example, gratuitous seizure. Cases of bringing businessmen to justice under Art. 159 of the Criminal Code of the Russian Federation, despite the fact that the actions of the accused contain signs of other, less serious crimes (for example, tax crimes or other crimes in the field of economic activity).

It remains a big problem in the investigation and trial of criminal cases against entrepreneurs under Art. 159 of the Criminal Code of the Russian Federation remains for long periods of investigation and consideration of cases in courts. Even with the relative simplicity of the case, the investigation time is on average about one year, and the judicial review is even longer. Moreover, the accused has been in custody all this time or, if he is “lucky”, under house arrest.

It should be noted that over the past 10 years, the practice of imposing punishment under Art. 159 of the Criminal Code of the Russian Federation has undergone fundamental changes; if previously, compensation for damage and admission of guilt actually guaranteed the assignment of a suspended sentence, now, even with the conclusion of a pre-trial agreement on cooperation, the chances of assigning a suspended sentence under Part 4 of Art. 159 of the Criminal Code of the Russian Federation are small (with the exception of certain regions, for example the Republic of Crimea).

From all of the above, one simple conclusion follows: despite all the measures taken in the form of liberalization of criminal procedural legislation , criminal cases continue to be actively initiated against entrepreneurs under Article 159 of the Criminal Code of the Russian Federation . Moreover, many of them initially have no judicial prospects due to the absence of signs of any crime. However, even in this case, the entrepreneur is forced to experience serious negative consequences in the form of placement in a pre-trial detention center, searches and the actual impossibility of carrying out further commercial activities.

Therefore, it is very important from the very beginning to enlist the support of a competent fraud lawyer who will provide the necessary assistance both at the stage of the preliminary investigation and in court. The specialist can achieve the termination of the criminal prosecution/case, an acquittal or the imposition of the most lenient punishment: the final results depend on the circumstances of the case. You should not wait for a criminal case to be initiated: if you have the financial means, you should contact a lawyer immediately after receiving a request for documents or a call for an interview (some entrepreneurs enter into agreements even in the absence of any problem, insuring themselves for the future).

Author of the material:

lawyer Sarkisov V.I.