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Case analysis: OTC in the currency circle and the crime of covering up and concealing criminal proceeds



The People's Procuratorate of Xiaoxian County, Anhui Province charged that the defendant, Zhou Moumou, had met and contacted a person named "Candy" through chat software since July 2019. "Candy" asked Zhou Shoujie to provide his bank card number to transfer money to Zhou. XX, and then Zhou XX bought USDT coins on, and then sold the purchased USDT coins. After the sale, Zhou Moumou will transfer the money from selling USDT coins to the other party, and the other party will give Zhou Moumou a commission of 25 yuan for every 10,000 yuan according to the amount of money transferred.

In August 2019, in the name of helping Wu make money, a WeChat account named "Gong Cheng Famous" defrauded Wu, who lives in Longcheng Town, Xiao County, of more than 437,000 yuan through the "Noah Wealth" platform with Dai's bank card. 147,997 yuan in a certain bank card was transferred to the bank card of the defendant Zhou Moumou to purchase USDT coins on Later, Wu reported the case, and the investigative agency locked Zhou through the bank flow and was arrested.

Case · Court opinion The court held that "Candy" once provided Zhou with the bank card numbers of Minsheng Bank, Postal Bank, Industrial and Commercial Bank of China, Bank of China, etc., each time ranging from 10,000 to 100,000 yuan. 150 transactions. The bank card transaction records prove that since July 2019, "Candy" has transferred about 6.6 million yuan to Zhou's bank card; But still want to make money. The defendant Zhou Moumou knowingly transferred the proceeds of crime, the circumstances were serious, and his behavior constituted the crime of covering up and concealing the proceeds of crime.

Huobi China won the award of "Blockchain Top Ten Application Chain Reform Cases": According to official news, it is to commend the units and individuals who have contributed to the "two developments of blockchain". On October 22, the China Communications Industry Association Blockchain Professional Committee (hereinafter referred to as the Special Committee) awarded the Golden Apricot Award for advocating the "1024 Blockchain China Day" at the "1024 Blockchain China Day" series of activities.

Ten projects such as Tencent's electronic invoice, Ali's AntChain, and Huobi China's Coconut Points blockchain monitoring platform won the "Blockchain Top Ten Application Chain Reform Cases" award. At the same time, Huobi University won the Blockchain Ecological Contribution Award. Yu Jianing, the rotating chairman of the special committee and the president of Huobi University, and others won the Special Contribution Award for Blockchain Development. [2020/10/22]

Although our country does not recognize the currency attribute of virtual currency, it recognizes the transaction attribute of virtual currency as a commodity, and has relevant policies to regulate it. However, it is also because of the concealment characteristics of digital currency that many criminals also take a fancy to this and use OTC transactions to engage in "money laundering" activities.

Guangzhou announced the excellent cases of blockchain application demonstration scenarios in 2019: On April 27, the Guangzhou Municipal Bureau of Industry and Information Technology announced the excellent cases of blockchain application demonstration scenarios in Guangzhou in 2019. The specific business of the blockchain involved in the excellent cases includes: application demonstration of food and drug traceability system based on big data and blockchain, intelligent document processing of shipping container-zce logistics, and "digital intellectual property platform", etc. (Sina Finance) [2020/4/27]

The over-the-counter trading of OTC in the currency circle is still a difficult point in supervision and is on the edge of the law. As mentioned in the above case sharing, recently, practitioners in the currency circle have been sentenced to imprisonment and fines for the crime of concealing and concealing criminal proceeds, and the legal risks of over-the-counter transactions are also increasing. During the practical process of handling cases, according to the above-mentioned legal provisions, the investigative agency usually freezes the bank card funds or even detains the person on the grounds that the relevant personnel "knowingly" it is stolen money. How does the law define this?

Article 312 of the "Criminal Law": Whoever knowingly harbors, transfers, purchases, sells on behalf of others, or uses other methods to cover up or conceal the proceeds of crimes and the proceeds generated by them shall be sentenced to fixed-term imprisonment of not more than three years, criminal detention or public surveillance. A fine may be imposed concurrently or solely; if the circumstances are serious, the offender shall be sentenced to fixed-term imprisonment of not less than three years but not more than seven years and shall also be fined.

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"Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in Trials of Criminal Cases Concealing and Concealing Criminal Proceeds and Proceeds from Crime"

Article 1: Whoever conceals, transfers, purchases, sells on behalf of others, or uses other methods to cover up or conceal knowingly the proceeds of crimes and the proceeds generated therefrom shall be punished in accordance with Article 312 of the Criminal Law. Conviction and punishment for the crime of covering up, concealing criminal proceeds and crime proceeds:


④ Covering up and concealing behaviors prevents timely investigation and punishment of predicate crimes and causes irreparable loss of public and private property;

⑤ Carrying out other acts of covering up and concealing criminal proceeds and the proceeds generated therefrom, hindering judicial authorities from prosecuting predicate crimes.

News | Fuzhou Free Trade Zone released the fifth batch of financial innovation cases, including cross-border business blockchain service platform pilot cases: Recently, the Fuzhou Free Trade Zone Management Committee, the Fuzhou Central Branch of the People's Bank of China, the Fujian Banking and Insurance Regulatory Bureau, and the Fujian Securities Regulatory Commission Bureau, Municipal Financial Supervision Bureau and other units released the fifth batch of 10 financial innovation cases. So far, the number of financial innovation cases released by the Fuzhou Free Trade Zone has increased to 80. The fifth batch of financial innovation cases focuses on the four aspects of financial service quality and efficiency, cross-border financial innovation, highlighting the characteristics of Taiwan and the Maritime Silk Road, and promoting high-quality industrial development. Among them, the promotion of cross-border financial innovation mainly includes the first batch of cross-border business blockchain service platform pilots in the country and the national fund management service platform - Strait Fund Port. [2019/11/8]

Article 10: The stolen money and goods obtained directly through crimes shall be recognized as "proceeds of crime" as stipulated in Article 312 of the Criminal Law. The perpetrators of predicate crimes obtain the fruits, rents, etc. after processing the criminal proceeds, which shall be recognized as "proceeds from criminal proceeds" as stipulated in Article 312 of the Criminal Law.

Knowing that it is criminal proceeds and the proceeds generated by it, adopting methods other than concealment, transfer, acquisition, and sales on behalf of others, such as introducing sales, receiving, holding, using, processing, providing fund accounts, and assisting in converting property into cash and financial instruments , marketable securities, assisting in the transfer of funds, remittance abroad, etc., shall be determined as "other methods" as stipulated in Article 312 of the Criminal Law.

Suning Consumer Finance connects with Suning Alliance Chain to create a financial blockchain application case: According to China Securities Network, recently, Suning Consumer Finance successfully connected to Suning Alliance Chain through an independent deployment node, and carried out services such as blockchain blacklist data upload and query. Create financial blockchain application cases to help the development of financial technology. [2018/6/25]

Law·Determination of "knowingly" According to the above-mentioned laws, we obviously found that all the provisions mentioned a point at the beginning: "knowingly". In other words, only if you know that the property is the proceeds of crime, and you have carried out transfers, concealments, etc., can you constitute this crime. Then, in the process of investigation by the public security organ, based on which performances will it be presumed that you know that it is the proceeds of crime? In other words, what kind of review obligations do we need to fulfill in the process of currency circle transactions in order to avoid being "caught up" by the public security organs?

Article 1 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Specific Application of Law in the Trial of Money Laundering and Other Criminal Cases: The "knowledge" stipulated in Articles 191 and 312 of the Criminal Law should be combined with the defendant's consciousness The judgment shall be based on subjective and objective factors such as knowledge ability, contact with other people's criminal proceeds and their proceeds, the type and amount of criminal proceeds and their proceeds, the method of conversion and transfer of criminal proceeds and their proceeds, and the defendant's confession.

During the investigation process, the public security organs usually determine whether they know it through the following behaviors:

① Assisting in the conversion or transfer of property through illegal means without justified reasons;

②Purchasing property at a price significantly lower than the market price without justified reasons; or assisting in the conversion or transfer of property and charging a "handling fee" that is significantly higher than the market price;

③ Assisting others to deposit huge amounts of cash in multiple bank accounts or transfer frequently between different bank accounts without justified reasons. the

However, in practice, the methods of money laundering are "various and strange", and the specific reasons for the determination of "knowledge" by public security organs and courts are also different. In the above case, although there is no direct evidence to prove that Zhou Moumou was aware of the criminal behavior of others, he did not charge an obviously unreasonable handling fee. However, the combination of "multiple, several, irregular, large transfers" is enough to make people have reasonable doubts: what is my previous family doing? At this time, if there is no further review, for example: asking the other party to provide evidence to prove the source of funds and business, etc., but just relying on "I don't know" to get rid of the crime, isn't this "deception"?

OTC transactions · Precautions Seeing this, many friends may be "unaware of the situation", and they are not very clear about the possible concealment and concealment of crimes that may be committed during the currency transaction process. According to the author's experience in searching relevant cases and handling cases, in current judicial practice, public security organs and courts are very serious about the determination of "knowledge" and judge strictly based on the circumstances listed in the above-mentioned relevant laws, and will not easily expand the scope of the presumption. At the same time, it is up to the prosecutor, that is, the public security organ and the procuratorate, to provide evidence to demonstrate their own presumption, form a complete chain of evidence, and rule out reasonable doubts in order to meet the criteria for conviction.

Here, Attorney Liu will share with you the experience accumulated in the process of handling related cases and the places that are easy to "step on thunder" for free, so as to reduce your risk of OTC transactions.

First, conduct transactions on large platforms, such as Huobi, OKEx, etc. The laws of our country recognize the commodity attribute of digital currency, so the transaction behavior of digital currency is protected by law. To buy and sell digital currency on a large platform, although the platform will charge a handling fee, the security is relatively high, which can effectively reduce transaction risks.

Second, in the transaction process, mainly review the number of transactions of the other party and ask the source of funds of the other party. When necessary, the other party can be required to provide proof of the source of funds, and pay attention to retaining relevant evidence, recording the transaction time, transaction object, transaction amount, etc. Don't easily join charging groups, circles, groups, etc. that use "high transaction" as a gimmick.

Third, you can ask the other party to provide the bank card flow to check whether the funds used by the other party for transactions stay in the card for a long time (one week), which can prove the legitimacy of the funds from the side. If the funds are only on the card for a few hours before being transacted, there is a good chance that criminals are trying to move the stolen money as quickly as possible.

Fourth, I still want to remind you that OTC transactions are risky, and large transactions need to be cautious. During the transaction, if the other party proposes an offline transaction at an unreasonable price, do not be blinded by the momentary interests and fall into the risk of criminal offenses.

Keeping the above points in mind can effectively reduce the risks that may arise during OTC transactions and fulfill the obligation of "knowingly". Even if the bank card is frozen by the public security agency, you can submit evidence and communicate at the first time to unfreeze it as soon as possible and reduce losses. .


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