Determination of the crime of virtual currency settlement payment-type aid

Authors: Shi Jinghai, Su Qing; Source: People's Court Daily

Virtual currency settlement payment assistance is the act of using virtual currency to provide assistance for others to carry out telecommunications fraud. In order to strengthen the crackdown on telecommunications fraud and its aiding behavior, in 2021, the Supreme People's Court, the Supreme People's Procuratorate, and the Ministry of Public Security jointly issued the Opinions (II) on Several Issues Concerning the Application of Law in the Handling of Telecommunications Network Fraud and Other Criminal Cases (hereinafter referred to as "Opinions (II)"), which proposed that in the absence of prior collusion, the act of converting or cashing out the helper through virtual currency knowing that the property is the criminal proceeds of telecommunications network fraud constitutes a cover-up or concealment of the criminal proceeds. The crime of proceeds of crime clearly includes such acts as a key link in the whole chain to combat illegal and criminal activities of telecommunications fraud, which effectively curbs the high incidence of related crimes.

However, with the deepening of governance activities, the drawbacks of distinguishing between this crime and other crimes in the Opinion (2) by whether or not "knowingly" and "conspiring in advance" have also emerged. Due to the time-space nature of virtual currency settlement and payment type assistance behavior, it may occur during or after the implementation of telecommunications fraud, and the degree of "collusion" and "knowing" is not the same, and also arises at different stages of the implementation of telecom fraud, judicial practice has appeared in the standards for determining whether the transferred property is the proceeds of crime, the rules for determining whether the settlement payment act is a fraud crime or a stolen property crime are not perfect, and the subjective impact on the characterization of the behavior has not been clarified, resulting in the help of the crime of fraud. The dilemma that the crime of aiding information network criminal activities, as well as the crime of concealing and concealing criminal proceeds and the crime of criminal proceeds, is easily confused, affects the precise crackdown on such acts by the criminal law, and is not conducive to the long-term governance of telecommunications fraud.

In order to clarify the path for identifying virtual currency settlement and payment-type assistance behavior, and to punish this behavior in accordance with the law, the principle of unity of subjectivity and objectivity, the criminal policy of leniency and strictness, organically combining the objective and subjective aspects of the constituent elements of the crime, comprehensively grasp the circumstances of the crime, and avoid unilaterally identifying the crime from the objective or subjective aspect, resulting in incompatible criminal responsibility and punishment. Based on this, in the criminal determination of virtual currency settlement and payment behavior, it is necessary to grasp the characteristics of criminal proceeds, the dividing point between upstream telecommunications fraud and subsequent cover-up and concealment of criminal proceeds and their proceeds, and the impact of the time and content of the helper's subjective knowledge and "collusion" on the determination of the crime, so as to distinguish the crimes that are easy to mix.

First of all, according to Article 64 of the Criminal Law, "criminal proceeds are all property illegally obtained by criminals", it is judged whether the object transferred by virtual currency has the three characteristics of criminal proceeds, namely, property, criminal illegality, and certainty. To elaborate, first, the proceeds of crime are property, which have property nature, that is, negotiable and objective property value, but do not take materiality as a necessary feature, including property interests such as deposit claims and equity. Second, the proceeds of crime must be generated by illegal acts and have criminal illegality, so they do not include property obtained by criminals due to lawful acts, civil breach of contract or administrative violations. Third, the proceeds of crime need to belong to the criminals and cover "all" of their illegal gains, so they have certainty in terms of both subject and amount. In the determination of the crime of concealing or concealing criminal proceeds or proceeds of crime, the certainty of the subject means that the criminal proceeds have indeed belonged to the perpetrator of the predicate crime; The certainty of the amount means that the amount of criminal proceeds should be based on the amount finally obtained by the perpetrator of the predicate crime, excluding the funds used in the transaction, for example, in the fraud case of pretending to be a qualified person to recommend stocks, the handling fee or membership fee paid by the victim to the fraudster is the proceeds of crime, and the funds used for stock speculation and investment ultimately do not belong to the fraudster and should not be included in the criminal proceeds. Accordingly, the property paid by virtual currency settlement meets the above three characteristics in order to be recognized as criminal proceeds, otherwise such acts cannot be evaluated as the crime of concealing or concealing criminal proceeds and criminal proceeds.

Secondly, taking the completed crime of fraud as the dividing point, define whether the virtual currency settlement and payment behavior is an act of disguising or concealing criminal proceeds and their proceeds, or an act of helping upstream telecommunications fraud. However, the Guidelines for Procuratorial Organs in Handling Telecommunications Network Fraud Cases issued by the Supreme People's Procuratorate in 2018 clearly stipulate that the determination of completed telecommunications network fraud should be based on the loss of control, that is, the victim loses actual control over the money defrauded. Accordingly, the successful completion of upstream telecommunications fraud not only means that the fraud has been carried out, but also indicates that the subject and amount of criminal proceeds have been determined. Therefore, the act of virtual currency settlement and payment that occurs after the completion is a typical act of disguising and concealing the proceeds of crime and their proceeds. Before the completion of the accident, even if the victim disposed of the property due to a misunderstanding, and the fraudster obtained the property, because the fraud is still being carried out or the property is still controlled by the victim, the final amount of fraud cannot be determined, so the virtual currency settlement payment behavior that occurs at this stage is an act of helping upstream telecommunications fraud. Taking virtual currency stock speculation fraud cases as an example, the victim first transfers funds to the helper after being deceived and has a misunderstanding, so as to obtain virtual currency for stock trading on a man-controlled securities platform, and the helper then transfers the funds to the fraudster. Then, the fraudster will adjust the rise and fall of the stock on the securities platform, so that the victim will gradually illegally occupy the funds in a way that first partially profits and then all losses. In such cases, since the victims can also control the funds on the platform by buying up and down after the fraudster obtains the property, the crime of fraud has not yet been completed, and the act of virtual currency settlement and payment cannot constitute the crime of concealing or concealing the proceeds of crime.

Finally, whether the helper conspired with others in advance, whether he only recognized that others were illegally using information networks to carry out criminal activities or knew that others were fraudulent, and whether the act of virtual currency settlement and payment constituted an accomplice to the crime of telecommunications fraud. Specifically, first, whether the helper conspired in advance to determine whether the act of concealing or concealing the proceeds of crime and its proceeds constituted the crime of concealing or concealing the proceeds of crime, or whether it was an accomplice to the crime of fraud. Among them, "beforehand" refers to before the end of the crime; "Conspiracy" means that the helper forms a voluntary contact with others, but it is not the same as "conspiracy", that is, there is no need for the parties to negotiate the crime. In the case of telecommunications fraud, if the helper has formed a conspiracy with others to commit fraud before the end of the fraud, he should be investigated as an accomplice to the crime of fraud. After the fraud is committed, even if the helper conspires with others about the fraud, it does not constitute a successor accomplice, and his behavior only constitutes the crime of concealing or concealing the proceeds of crime. In addition, from the existing judicial interpretations, unilateral accomplices do not constitute a joint crime of fraud. This is because the Opinions on Several Issues Concerning the Application of Law in the Handling of Criminal Cases Involving Telecommunications Network Fraud and the Opinion (II) issued by the Supreme People's Court, the Supreme People's Procuratorate and the Ministry of Public Security in 2016 changed the previous practice of treating the helper providing fee settlement as an accomplice as long as the helper who provided the fee settlement knew that others were fraudulent, emphasizing that the act of cashing, cashing out or withdrawing the proceeds of crime constituted a joint crime should be premised on the circumstances of prior conspiracy, so a helper who unilaterally had joint criminal intent did not constitute an accomplice. Second, if the act of virtual currency settlement and payment is characterized as an act of aiding upstream fraud, whether the helper knowingly knows that others have committed fraud or only knows that others have committed crimes on the Internet, and distinguish between helping the perpetrator of fraud and helping information network criminal activities. In the trial of a specific case, the proof of "collusion" and "knowledge" should be based on objective evidence, including the life experience of the helper, the channels and content of contact with telecom fraudsters, the time and method of settlement and payment, and the profit situation, and then characterize the behavior accordingly.

In summary, there are three situations in which the criminal determination of virtual currency settlement and payment assistance is carried out, the first is that the helper does not collude with others before the end of the fraud act, and after the fraud crime is completed and the fraudster obtains property with property, illegality and certainty, he deliberately provides virtual currency settlement and payment assistance to him, which constitutes the crime of concealing and concealing criminal proceeds and criminal proceeds. Second, although the helper has objectively carried out the act of concealing or concealing the proceeds of crime, he has formed an intentional contact with others about the fraud at the end of the fraud act, and his behavior should be recognized as an accomplice to the crime of fraud; If the helper reaches an intentional contact with others with the content of carrying out cybercriminal activities at the end of the fraudulent act, his act constitutes the crime of aiding information cybercriminal activities. Third, if the crime of fraud has not been completed or the property does not have the three characteristics of criminal proceeds, but the helper knowingly commits fraud and provides virtual currency settlement and payment services, he shall be recognized as an aider of the crime of fraud; Where a helper knows that others have committed cybercriminal activities, but does not know the specific commission of the crime, he shall be investigated for criminal responsibility for the crime of aiding information cybercriminal activities.

In addition, in order to severely punish and prevent telecommunications network fraud and assistance in accordance with the law, while clarifying the rules for the application of criminal law and crime identification, it is also necessary to uphold the thinking of comprehensive management and source management, use new technologies outside the criminal legal system to strengthen the supervision of virtual currency circulation, promptly take interception measures against the transfer of funds when illegal acts occur, and strengthen publicity and education on anti-telecommunications fraud, virtual currency transaction speculation and informal network platform investment risk early warning, so as to fundamentally prevent telecommunications fraud and illegal use of virtual currencyto ensure the security of people's network information and property.

[This article is the research result of the Supreme People's Court's 2023 major judicial research project "Research on the Judicial Application and Policy Improvement of the Crime of Aiding Information Network Criminal Activities Involved in the 'Two Cards' Case" (ZGFYZDKT202310-03)]

(Author's affiliation: Southwest University of Political Science and Law)