“It's a matter of trust - what if the information about our registered companies, accounts falls into the media, the law enforcement system starts to scare us. This did not happen, ”Finance Minister Anton Siluanov explained in January 2018 why a business can safely use the capital amnesty. But, as Vedomosti found out, it still happened. The FSB not only seized one of the special declarations of amnesty in the building of the central office of the Federal Tax Service, but also uses it as evidence in a criminal case, and the court did not find any violations in this. Experts call this a dangerous precedent that poses a threat to anyone who has decided to legalize their capital. It seems that tomorrow (after the publication of the article. - “Vedomosti”), many of those who believed the promises of the authorities will already fly abroad, the consultant ironically, whose clients actively submitted special declarations to the Federal Tax Service.
Evidence contrary to law
A dangerous precedent - lawyers interviewed by Vedomosti did not hear about other such cases - happened in the criminal case of Valery Izrailit, co-owner of the Ust-Luga company, which was building the eponymous seaport on the coast of the Gulf of Finland in the Leningrad Region. Copies of the indictment and other materials of the case, which is now being considered by the Smolninsky District Court of St. Petersburg, were provided to the “Vedomosti” by the defense.
According to the prosecution, the criminal group, which included Izralit, saved on the supply of low-quality pipes for the port and withdrew money abroad. In December 2016, Izrailit was arrested. Prior to this, having learned about the initiated case, he ordered his employees to remove all traces of his “business activity,” the indictment says, but one of the employees got scared and took the computer home, where the investigators seized him. Employees of the FSB Directorate for St. Petersburg and the Leningrad Region learned from ICQ correspondence that at the beginning of 2016 Izrailit filed an amnesty declaration. Having found information about the declaration, possibly an electronic copy, the investigators requested permission from the court to seize the declaration at the Federal Tax Service, said one of Izrailit’s lawyers, Victoria Burkovskaya, a partner of Egorov Puginsky Afanasyev and Partners. The court agreed with the investigators (Vedomosti reviewed his decision), and in March 2017 the declaration was in the hands of the FSB.
Its contents are also described in the indictment: in the middle of 2016, Izralit declared foreign companies controlled by it, an apartment in London, shares, bank accounts. One of these companies, Midwest Marketing Limited, Izralit allegedly intended to buy its own yacht, the prosecution said. So he wanted to explain the transfer of currency abroad in 2013, but then terminated the contract of sale, the report says.
This became the reason for accusing him of withdrawing funds abroad using forged documents, in addition, he is accused of legalizing funds obtained as a result of a crime and of especially large fraud (respectively, Articles 193.1, 174.1 and 159 of the Criminal Code, Criminal Code). Investigators used the declaration as evidence for the first two articles.
“If a person legalizes his funds and property in Russia, he will receive firm legal guarantees that he will not be dragged by various bodies, including law enforcement, to shake, will not be asked about the sources and methods of obtaining capital, that he will not face criminal or administrative harassment and there will be no questions from the tax services and law enforcement agencies. ” December 2014
Vladimir Putin, President of Russia
Izrailit’s lawyers insisted that this should not be done, citing a direct ban on the law on the voluntary declaration of assets and accounts. Amnesty relieves a person of responsibility for only certain crimes, for example, tax. And although Izrailit is charged under other articles of the Criminal Code, the guarantees provided by law apply to any criminal case, says Burkovskaya: a declaration cannot be used as evidence unless it has been introduced to the case by the declarant. But the court did not agree with this and on September 20 rejected the defense’s motion to exclude the declaration from the case. Since Izrailit is charged with crimes for which the amnesty does not apply, it means that the law on voluntary declaration is not applied and the declaration can be used as evidence, the court decided (Vedomosti read the recording of the statement of Judge Angelica Morozova provided by the defense).
The representative of the joint press service of the courts of St. Petersburg only confirmed that preliminary hearings are being held behind closed doors in the case, without answering substantive questions from Vedomosti. The representative of the Federal Tax Service did not respond to the request, as did the representatives of the FSB and the prosecutor's office of St. Petersburg on the weekend of September 21-22. The representative of Siluanov could not comment on the issue on Sunday evening.
Amnesty on faith
Most of the lawyers interviewed believe that the court flagrantly violated the amnesty law. The guarantees not to use special declarations as evidence apply to any corpus delicti, and not just to the articles mentioned in the law, Ruslan Koblev, a Koblev and Partners partner, is sure. There can be no double interpretation - this condition was the main guarantee that business can trust the state, he is categorical.
But some experts believe that the court can still set a dangerous precedent. In general, the logic of the court is understandable, says the managing partner of the law firm Rustam Kurmaev and partners Rustam Kurmaev: a person is accused of a crime to which the amnesty does not apply, so the declaration can be used as evidence. In addition, the court emphasized that the investigators acted in accordance with the law on operational-search activities, in which there are no exceptions to the law on voluntary declaration. But in this case, the declaration can be used in other cases, which contradicts the very essence of the amnesty - it loses its meaning and not only does not protect against possible prosecution, but, on the contrary, creates risks, warns KPMG partner Anna Voronkova. This is an isolated case, a federal official insists.
Initially, the amnesty was supposed to last from July 2015 to June 20, 2016 - for operations with declared assets and accounts, you cannot be held accountable for the crimes listed in the law. But the amnesty did not have much success - the business was afraid that from the safes of the tax authorities, declarations would reach the security officials as well. The second wave of amnesty was more popular. “It makes us very happy that people believed!” Said the head of the Federal Tax Service Mikhail Mishustin in an interview with Vedomosti a year ago. 19,000 people believed - so many declarations were filed by June 2019, the Ministry of Finance reported. According to Siluanov, in total over 2018, more than 10 billion euros were declared on accounts. As a result, officials decided to conduct another amnesty, which will last until March 2020.
The guarantees of the authorities were very important: the law on amnesty has enough gaps and many clients decided on it only because of the promises of the authorities that the security forces would not use the declarations, says one of the consultants. The main gap is the lack of amendments to the law on operative-search activity, Koblev believes: if the investigators familiarize themselves with the declaration and draw it up in the form of the results of operational-search activities, it is difficult to refute such evidence. Having seen the data from the declaration, the operative can freely use it, agrees Dmitry Kostalgin, managing partner of Taxadviser.
The business saw the risks in the fact that the amnesty did not apply to fraud (such a decision was made after consultations with FATF, an organization for counteracting the legalization and laundering of capital. - Vedomosti), Voronkova recalls. It turns out that the fears were not in vain, she concludes.
Lawyers believe that the use of the declaration in the Izrailit case clearly illustrates the situation with the investment climate in Russia and the guarantees that the authorities give to business. The main problem of the Russian legislation is in the constantly changing law enforcement practice, as well as the indictment.