Job-related crimes in the encryption era: Beijing’s 100 million yuan currency-related job embezzlement case, 89 million yuan recovered

The so-called "office crime" in our country's criminal law system is not a single crime, but refers to the use of existing powers by staff of state agencies, state-owned companies, enterprises, institutions, and people's organizations to engage in corruption, bribery, malpractice for personal gain, abuse of power, and negligence. Duty is a general term for crimes that infringe on citizens’ personal rights and democratic rights, undermine state regulations and norms on official activities, and should be punished criminally in accordance with the criminal law.

Sajie’s team found in practice that at present, crimes of corruption and bribery by state agency staff, as well as job embezzlement crimes by non-state agency staff, and bribery and bribery crimes by non-state staff, are increasingly involving encryption. Assets - More and more people are using crypto-assets as a hidden tool for delivering benefits.

Today, Sister Sa’s team will take recent cases that have occurred/detected as examples to talk to you about some of the key information revealed by these examples of currency-related job crimes in the encryption era.

01. Take stock of recent major currency-related official crime cases

What are the characteristics of cryptocurrencies? An old and fundamentalist narrative describes it this way: Cryptocurrency has the characteristics of decentralization, anonymity, non-tamperability, fast transaction speed, low transaction costs, and global peer-to-peer transactions.

Looking at it now, the above understanding of cryptocurrency is both correct and incorrect. At least, with the development and advancement of technology, the anonymity of cryptocurrency has become increasingly low, and so-called "anonymity" is becoming a "general means" used by ordinary people to protect the privacy of their transactions. In other words, if technologically powerful parties such as judicial authorities and technology companies want to investigate, most of the transaction information will be invisible.

**Case of currency-related official crimes committed by a senior

official of the China Securities Regulatory Commission**

Not long ago, the Discipline Inspection and Supervision Group of the China Securities Regulatory Commission and the Guangdong Supervision Commission jointly issued an announcement stating that the former director of the Science and Technology Supervision Department of the China Securities Regulatory Commission seriously violated disciplines and laws, abused policy recommendation, formulation, execution and other supervisory powers, and abandoned his science and technology supervision responsibilities. , seeking improper benefits for others in terms of information technology system service organizations’ business expansion, software and hardware procurement, etc., and using virtual currencies to conduct power-for-money transactions.

Judging from the announcement, the CSRC official may be suspected of a variety of crimes, and is more likely to be suspected of bribery.

According to the provisions of Article 385 of my country's Criminal Law, the crime of accepting bribes refers to the crime of accepting bribes when a state functionary takes advantage of his position to solicit property from others, or illegally accepts property from others to seek benefits for others. In the course of economic transactions, state functionaries who violate state regulations and accept kickbacks and handling fees in various names, which are owned by individuals, will be punished as bribes.

Under normal circumstances, the threshold for filing a bribery crime is 30,000 yuan. In terms of sentencing, if the amount exceeds 30,000 yuan but does not exceed 200,000 yuan, the person shall be sentenced to fixed-term imprisonment of not more than three years or criminal detention, and shall also be fined; if the amount exceeds 200,000 yuan but not more than 3 million yuan, the person shall be sentenced to fixed-term imprisonment of not less than three years but not more than 10 years, and shall also be fined or confiscation. Property; more than 3 million yuan, shall be sentenced to fixed-term imprisonment of not less than ten years or life imprisonment, and shall also be fined or have property confiscated.

**Beijing 's 140 million yuan virtual currency embezzlement case, 89

million yuan recovered**

On December 20 this year, the Beijing Municipal People's Procuratorate released a special case of "protecting enterprises": a company employee took advantage of his position to defraud the company's property, and used multiple overseas crypto asset trading platforms and "coin mixers" to transfer the proceeds of crime .

From 2020 to 2021, Feng took advantage of his position in the service provider and regional operations growth department of a technology company to conspire with Tang Moumou, Yang Moumou and others to defraud the company's service provider bonuses totaling more than RMB 140 million.

Subsequently, Feng directed Tang Moumou and Yang Moumou to use eight overseas virtual currency trading platforms to convert the money involved in the case from RMB into virtual currency. They confused the source and nature of the funds through overseas "currency mixing" platforms and exchanged them in the form of virtual currency. After multiple levels of transfer, part of the money involved flowed into accounts controlled by Feng and others in the form of RMB, and part of the money involved was concealed in the form of virtual currency by Feng and others.

After the incident, Feng returned the stolen 92 Bitcoins (approximately RMB 66.9 million if the price of BTC was US$100,000 per coin), recovering a total of more than RMB 89 million in stolen money, maximizing the economic recovery of the victim unit. loss.

Because Feng is not a staff member of a state agency, and the victim company is not a state agency, enterprise or institution, Feng's use of his authority to defraud the company's finances is suspected of "official embezzlement." Article 271 of my country's "Criminal Law" stipulates: Any staff member of a company, enterprise or other unit who takes advantage of his position to illegally appropriate the unit's property for himself, if the amount is relatively large, shall be sentenced to fixed-term imprisonment of not more than three years or criminal detention, and shall also If the amount is huge, he shall be sentenced to fixed-term imprisonment of not less than three years and not more than ten years, and shall also be fined; if the amount is particularly huge, he shall be sentenced to fixed-term imprisonment of not less than ten years and not more than ten years, and shall also be fined.

It should be noted that on April 29 this year, the Supreme People's Procuratorate and the Ministry of Public Security jointly issued the revised "Provisions on the Standards for Filing and Prosecution of Criminal Cases under the Jurisdiction of Public Security Organs (2)" which impose five types of illegal crimes, including bribery by non-state personnel. The standards for filing and prosecution of duty-related crimes committed by state functionaries shall be the same as those for duty-related crimes committed by state functionaries such as bribery. The new regulations clearly stipulate that if personnel of a company, enterprise or other unit take advantage of their position to illegally take possession of the property of the unit for themselves, and the amount exceeds 30,000 yuan (the original standard is more than 60,000 yuan), a case shall be filed. Prosecution.

Regarding the sentencing of the crime of occupational embezzlement, after the Eleventh Amendment to the Criminal Law will be promulgated in 2020, and the sentencing range will be adjusted from two levels to three levels, the judicial interpretation has not been simultaneously improved and followed up. Therefore, in practice, the sentencing of this crime generally follows the following Regulations and judicial practice:

02. What key information is revealed in examples of currency-related job

crimes?

Why do we say that using cryptocurrency to take bribes is nothing or everything? This is also due to the technical features of blockchain technology that data on the chain cannot be tampered with and are open and transparent - the encrypted assets themselves are very hidden, but once the criminal facts are verified, there is ironclad evidence.

In the cases related to job-related crimes that Sister Sa’s team has previously handled, identifying the financial links and flows of suspects’ job-related crimes is often the top priority in such cases. A large number of criminal suspects will use their social relationships to Crime is said to be concealed and dispersed through various covert measures, and layers of risk isolation measures are established.

However, in cases where encrypted assets are used to commit duty-related crimes, the fund flow links are often relatively complete and verifiable, and their authenticity is guaranteed. Once it is verified that there is a connection between the fund flow involved in the case and the suspect’s job-related crimes (often also in such cases) (difficulties in investigation), the data on the relevant chain will become ironclad evidence of the crime.

Judging from several recent currency-related official crimes, my country’s judicial authorities have revealed several key pieces of information in handling such cases:

1. Reconnaissance technology has improved significantly, and currency mixers are no longer a weapon for money laundering/concealing criminal proceeds.

From the official embezzlement case disclosed by the Beijing Municipal Procuratorate, it can be found that even if the criminal suspect used multiple cryptocurrency trading platforms or even a currency mixer to confuse the fund links, the criminal facts were still grasped by the judicial authorities. Therefore, the Sajie team believes that for the investigation technology of the judicial organs of our country (it is reasonable to speculate that other major economically developed countries and jurisdictions also have the same level of technology), the current mainstream currency mixers can only increase the investigation work. If you want to check the effect of quantity, you can definitely check it.

2. The recovery of stolen goods from currency-related duty-related crimes still mainly relies on the initiative and consciousness of criminal suspects.

In fact, this can be seen from the recent overseas crypto asset unfreezing cases handled by Sajie's team. Crypto assets do have special characteristics that distinguish them from other assets - recovery of stolen goods and losses largely depends on the cooperation of criminal suspects.

Using USDT as an example, if a criminal suspect converts the proceeds of crime into stable currencies such as USDT and hides this part of the assets, even if the flow of the funds can be traced, the funds have been actually controlled by overseas persons. my country’s judicial system The authorities can only issue a judicial freezing document to the issuing company TEDA, requesting that the funds be frozen. The actual consequence is that overseas criminal suspects cannot use the funds involved, but our country's judicial authorities cannot directly recover them.

If the funds are converted into crypto assets such as BTC and ETH and are hidden in cold wallets and controlled by foreign personnel, our country's judicial authorities will not even be able to effectively freeze them, making it even more difficult to recover the stolen goods.

03. Write at the end

With the advent of the crypto-asset bull market led by BTC and the integration and cooperation between the traditional financial system and crypto-assets, the scale of the entire industry is constantly expanding. In one word, the Sajie team believes that crypto-assets will become more and more job-related crimes in the future. a common method.

On the one hand, this requires our country’s Discipline Inspection Commission and public security agencies to strengthen their awareness and understanding of crypto assets as soon as possible and to upgrade detection techniques in a targeted manner; on the other hand, state agency staff, corporate directors, supervisors and senior executives should also understand It should be noted that crypto assets are not a panacea for profit transfer, and do not touch the criminal red line with any luck.