The Law on Digital Financial Assets (the DFA) will help in the fight against corruption, according to the Moscow Region’s Main Department of Regional Security (GURB).
“In Russian law, the legal status of virtual currency had not been established, which made it impossible to recognise it as an object of civil rights and complicated the qualification of illicit transfers of cryptocurrency as bribes,” said the head of the agency Roman Karataev.
Under the law, digital currencies are recognised as property and objects of civil rights. In that capacity they are considered in a number of federal laws, including the Law on Combating Corruption, according to the press service.
The DFA Law amends the Law on Prohibiting certain categories of persons from opening and holding accounts (deposits), storing cash and valuables in foreign banks located outside the territory of the Russian Federation; specifically, digital currencies are added to the list of prohibited instruments.
It also amends the Law on the monitoring of officials’ expenses and other persons’ incomes.
Now officials are obliged to declare cryptocurrency and report on purchases of it if the total value of such transactions exceeds a family’s income for the reporting year and the three preceding years, according to GURB.
Lawyers say that law enforcement could have qualified crimes involving cryptocurrency as property crimes.
“But practice has gone down the most formal path, and bribes, fraud, theft and other such acts really were not recognised as such if performed using cryptocurrency,” said the ForkLog advisor on IP/IT practice at Tomashevskaya & Partners, and a member of the Commission on Legal Support for the Digital Economy of the Moscow branch of the Russian Lawyers Association, Roman Yankovsky.
Efim Kazantsev, an expert at Moscow Digital School, added that before the DFA law there were indeed discrepancies concerning the legal qualification of cryptocurrency, including in criminal cases.
“The technical difficulty of identifying and proving the elements of corruption crimes whose subject is digital currency will not disappear, but at least one legal problem for law enforcement will be reduced,” he noted.
In July 2020, after years of statements and revisions, the State Duma passed the DFA law.
It is expected that more detailed regulation of cryptocurrencies will be laid out in a separate bill or addressed by amendments to the enacted law.
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