Russian Court: Theft Of 100 BTC Isn’t A Crime Because Bitcoin Isn’t Property

[Bitcoinmoon12]

Subsequent developments in the case involving two men impersonating the Federal Security Services (FSBs) have paid off. In particular, on June 30, the Russian criminal court rejected the claim for victims with the argument that Bitcoin and other cryptocurrencies do not inherit the same protection as other types of assets.

The case began in 2018 when two men impersonating Federal Security Service (FSB) employees and their accomplices kidnapped the victim and forced him to give them 5 million rubles or $ 90,000 in cash and 99.7 BTC – worth about $ 900,000 at the time. The kidnappers were sentenced to eight and ten years in prison.

After that, the lawsuit went on and on because the victims demanded compensation and forced the scammers to pay back the money they stole. The court still ruled in favor of the victim, insisting the criminals had to repay 5 million rubles. However, when it comes to cryptocurrencies, the court declared that they could not respond to the claim, as Bitcoin was not legally recognized by Russian law.

Therefore, it seems that this incident is outside their jurisdiction.

Even so, victims can still try their luck in civil court. Regardless of any future legal proceedings, this court’s decision is remarkable – in essence, it claims that Bitcoin theft is not a crime.

Source: The Russian Criminal Court Rejected The 99.7 BTC Claim From The Victims Because Bitcoin Was Not Recognized As Legal Tender

[xxjumperxx]

Wow!
That is all I can say about this case...
So if they would have just taken the 100BTC it wouldn't have been a crime at all?

Russia sure is dealing with BTC in a very different way that I havent heard of...

[gentlemand]

OP, you should put your entire post in quotes since the whole post is a quote. People get funny about that.

They probably were the FSB and even if they weren't the judge probably got half the BTC for that ruling.

I find this pretty weird. There are tons of things with value with no legal status other than being property and that should be enough no matter what legal system it is, not that Russia really has one any more.

[Yaunfitda]

Just show how Russia is really ignorant of BTC or you can't ruled out that ehem, maybe they themselves got the BTC from the ciminals themselves (just my speculation). But if you have to think about it, doesn't make sense for the judge not to rule in favor of the victims, in terms of the BTC stolen. And this is the reason why Russia really lags as far as implementing crypto regulations or they simply don't what to accept BTC.

[Lucius]

This seems like a very dangerous message for all those who own cryptocurrencies, and practically leaves them completely unprotected if they become victims of such theft. Given the crime rate in Russia and the fact that bribery and corruption is a practical way of life there, individuals and especially legal entities should be well guarded if they have anything to do with crypto.

So if they would have just taken the 100BTC it wouldn't have been a crime at all?

It depends on how you steal them, because the criminals in this case are still convicted because the robbery involved a kidnapping - but if they had done it in a slightly more sophisticated way, then nothing would have happened to them. If they endure their prison days, when they get out of prison, real wealth awaits them - unless they themselves become victims of theft. I am sure that the Russian mafia will not let them just go under the radar.

[xxjumperxx]

It depends on how you steal them, because the criminals in this case are still convicted because the robbery involved a kidnapping - but if they had done it in a slightly more sophisticated way, then nothing would have happened to them. If they endure their prison days, when they get out of prison, real wealth awaits them - unless they themselves become victims of theft. I am sure that the Russian mafia will not let them just go under the radar.

Exactly, Im pretty sure the mafia knows all about this and is just waiting for them outside of prison and is ready to be paid.
News like this is a gold mine for the mafia and Im pretty sure they are really interested in that amount of BTC/Cash!

[dothebeats]

Why am I not surprised that the Russian courts don't really see bitcoin as a legal property at all? I'm pretty sure that those behind bars are all set in life and are just waiting for their sentences to be done and they're back in business. With that amount, I'm pretty sure they are now  just taking their sweet time and just awaiting orders on who to hit next and will get away with it should they ever get nabbed once more.

That's why you don't flaunt to everyone that you own bitcoin or any crypto for that matter. There is still that grey area wherein the legality of the cryptocurrencies are still aren't acknowledged by the governments and even the people. Once you get robbed, you can't do shit on the courts.

[NeuroticFish]

Regardless of any future legal proceedings, this court’s decision is remarkable – in essence, it claims that Bitcoin theft is not a crime.

I see it more like a "if legally we don't know what it is and what's its value, it's not considered property (hence there's no theft)".
It's obviously worrying and imho this puts Russia (way) under China in the way of dealing with Bitcoin.

It looks like the criminals had a good lawyer. However, I hope that civil court will correct this.

[gentlemand]

I see it more like a "if legally we don't know what it is and what's its value, it's not considered property (hence there's no theft)".

If I have a sculpture made out of celebrity eyelashes stolen then I would expect that to be prosecuted despite it being a whole lot more obscure, completely unregulated and hard to value.

There are countless places where the value can be checked and countless places where it can bought and sold. It's no more or less tangible than any other piece of electronic value like a stock or a bank account balance.

I'll guess the judge was probably drunk. Or not even present.

[alani123]

The source seems to be a Telegram post?
https://t.me/SPbGS/5607

Linked in this cointelegraph post.

Seems poorly sourced anyway as no other news outlets outside of the space picked up the news from what it seems.
If true however, it's surely a weird development. It's likely to have originated from a court's inability to understand the precedent they might be setting. By that logic, digital assets, services and anything digital that could be sold for value also shouldn't be considered property. How about every Russian starts stealing iTunes gift card codes or bank card numbers and then cite case law to claim that it wasn't theft? Hopefully such convictions will be overturned.

[gentlemand]

How about every Russian starts stealing iTunes gift card codes or bank card numbers and then cite case law to claim that it wasn't theft?

Isn't that what many do already anyway? Russia has to be one of the world capitals of online theft and general mischief. And it's not as if they would ever extradite anyone under any circumstances for anything.

[NeuroticFish]

I see it more like a "if legally we don't know what it is and what's its value, it's not considered property (hence there's no theft)".

If I have a sculpture made out of celebrity eyelashes stolen then I would expect that to be prosecuted despite it being a whole lot more obscure, completely unregulated and hard to value.

There are countless places where the value can be checked and countless places where it can bought and sold. It's no more or less tangible than any other piece of electronic value like a stock or a bank account balance.

I'll guess the judge was probably drunk. Or not even present.

Nice example! I agree. That's why I continued with "it's obviously worrying", it's an extremely unfair way to see what property means (what the Russians did there)

[squatter]

The source seems to be a Telegram post?
https://t.me/SPbGS/5607

Indeed, I'd like to see a more reliable primary source. All the outlets are just citing the Cointelegraph article.

I find this pretty weird. There are tons of things with value with no legal status other than being property and that should be enough no matter what legal system it is, not that Russia really has one any more.

There may be inconsistencies between the Russian Civil and Criminal codes. The Civil Code was amended late last year to define "digital rights" -- the term used to describe cryptocurrencies -- and cases where they conferred property rights or transfers. For example:

According to the revision, along with money, securities, and other property, the illegal provision of property-related services and property rights can now be considered part of a bribery offence. “In cases where the subject of the bribe is property rights, an official has the opportunity to receive income from the use of uncertified securities or digital rights,” the clarification details.

If a corruption case under investigation involves the transfer of digital rights, their value has to be estimated by experts employed to conduct a monetary assessment, the court remarks. Its decree also explains that the transfer of such assets to an “electronic wallet” is to be considered as the exact moment of the bribe that has been paid.

Perhaps the criminal courts currently lack jurisdiction, but restitution is within the purview of the civil courts.

[Lucius]

The source seems to be a Telegram post?
https://t.me/SPbGS/5607

The source is really that post from Telegram, but it seems to be Joint Press Service of the courts of St. Petersburg (Oбъeдинённaя пpecc-cлyжбa cyдoв Caнкт-Пeтepбypгa) and it looks credible. The translation using Google looks like this :

Joint Press Service of the courts of St. Petersburg
The Petrograd District Court of St. Petersburg announced the verdict against Peter Piron, found guilty of committing crimes under subsection b of part 2 of article 163 of the Criminal Code of the Russian Federation, part 2 of article 325 of the Criminal Code of the Russian Federation, and Yevgeny Prigozhin, convicted of the commission of a crime under subsection b of part 3 of article 163 of the Criminal Code of the Russian Federation.

According to the plot of the charge (we reported on the receipt of the case - https://t.me/SPbGS/3970), the defendants managed to get money in the amount of 5,000,000 rubles, as well as cryptocurrency in the form of 99.7035 bitcoins, the value of which as of June 3, 2018 amounted to 48 101 130 rubles 87 kopecks, in the form of 2072150.73446889 digibytes, the value of which as of June 3, 2018 was 4 083 999 rubles 19 kopecks, in the form of 198700.17928287 bit-rates, whose value as of June 3, 2018 was 3 012 711 rubles 76 kopecks, and a total of 55 197 841 rubles 82 kopecks. In total, they managed to seize property for a total of 60 197 841 rubles 82 kopecks.

Prigogine initially pleaded not guilty, explaining that Sh. And K. had been slandering him in order to assist the investigating authorities in solving a particularly serious crime. After watching the video in the court session, Prigozhin, referring to forgetfulness, said that he pleads guilty as part of his legal position. Assuming that his actions are subject to qualifications under Art. 330 of the Criminal Code

Piron admitted guilt, but explained that he did not recognize the amount of damage, believing that he personally caused the victim only 850,000 rubles of damage, did not commit this crime by a group of persons by prior conspiracy, did not use violence against Sh. The rest of Piron took advantage of Art. 51 of the Constitution of the Russian Federation.

The court, in this particular case, based on the amount of the charge, found that the victim transferred the cryptocurrency he had to electronic wallets under the influence of threats associated with the requirement to transfer this payment instrument. From the information of the Bank of Russia it follows that there is no collateral and entities legally obligated for them in virtual currencies. Taking into account the provisions of Article 209 of the Civil Code of the Russian Federation, Article 128 of the Civil Code of the Russian Federation, Article 158 of the Criminal Code of the Russian Federation, cryptocurrency is not a crime against property, due to the lack of legal status it is not possible to recognize it as an object of civil law, this type of virtual money is not falls into any of the categories, is not a recognized means of payment on the territory of the Russian Federation, the legislator is assigned to surrogates of funds. In such circumstances, the court excluded the possession of cryptocurrency in the amount of 55 197 841 rubles 82 kopecks from the scope of the charge.

The court sentenced:
Prigogine in the form of 8 years of imprisonment in a maximum security prison.
Piron in the form of 10 years of imprisonment in high security IR

The claim of the victim is partially satisfied in the amount of 5,000,000 rubles. In the rest of the claim, it was left without consideration, and Sh. Recognized the right to satisfy the claim in the framework of civil proceedings.
Telegram
Joint Press Service of the courts of St. Petersburg
The Petrograd District Court of St. Petersburg has registered a criminal case against Peter Piron accused of committing crimes under subsection b of part 2 of article 163 of the Criminal Code of the Russian Federation, part 2 of article 325 of the Criminal Code of the Russian Federation, and Yevgeny Prigozhin accused of committing crimes ...

There are other sources (of course in Russian), which of course precede the verdict, and they give a slightly better picture of what actually happened. Personally, I was a little surprised that the verdict was passed in a little over 2 years, because the case happened in mid-2018.

Cyber ​​robbers posing as FSB officers will be tried in St. Petersburg

[alani123]

How about every Russian starts stealing iTunes gift card codes or bank card numbers and then cite case law to claim that it wasn't theft?

Isn't that what many do already anyway? Russia has to be one of the world capitals of online theft and general mischief. And it's not as if they would ever extradite anyone under any circumstances for anything.

Extradition? Probably not... India is a bit of the same under a similar premise. Online scams are tolerated by police because they bring in revenue to the country and employ many people. So long as they don't target locals nobody bothers.

But if it's codified into law that digital goods aren't property and therefore their repossession doesn't count as theft, then your country's own citizens are to suffer as well. I doubt any country would be willing to take such risk. Unless of course Russia has an agreement with all e-criminals under the table so they're free to target foreigners but not the country's nationals. Makes you wonder about Russia.

[cryptoperkele]

So, does this mean that all bitcoin/crypto exchanges in Russia can now just exit scam and steal all bitcoins without having any legal ramifications?

[gentlemand]

So, does this mean that all bitcoin/crypto exchanges in Russia can now just exit scam and steal all bitcoins without having any legal ramifications?

Are there any exchanges in Russia at all? Considering the government's pathetic wavering it's not something I'd put any money in. There was of course BTC-e which did not end well.

"the Russian criminal court" is a pretty weird turn of phrase. It may be a regional court and this was a one off decision. If I were the victim I'd be looking for a definitive answer from the highest court I could get heard in.

[cryptoperkele]

Are there any exchanges in Russia at all?
---

Yobit? Yeah i know... i avoid it at all costs, but surely there are even more sketchy ones in there. No wonder they aren't interested in KYC or anything like that.

[gentlemand]

Yobit? Yeah i know... i avoid it at all costs, but surely there are even more sketchy ones in there. No wonder they aren't interested in KYC or anything like that.

I'm sure there are Russian owned and operated exchanges. If they're sensible they would not be running them in Russia. Then again this might act as a wonderful incentive to bring some 'business' home.

Yobit is an eternal mystery. They've probably leased a secret Mir and hide in space.

[Findingnemo]

It may be a regional court and this was a one off decision. If I were the victim I'd be looking for a definitive answer from the highest court I could get heard in.

If someone has money then it is even possible to buy justice for them.

People who have no knowledge are in the place of giving justice, Is there any discussion related to this decision on media?