[1] Whether the intangible property value of which is recognized as being acquired by committing a serious crime under the Act on the Regulation and Punishment of Criminal Proceeds Concealment may be confiscated (affirmative)

[2] In a case where the defendant acquired bitcoin by violating the Act on Promotion of Information and Communications Network Utilization and Information Protection, Etc. (Distribution of obscenity) and the Act on Protection, etc. of Information and Communications Network Utilization and Information Protection, etc. (Distribution of obscenity) while operating the Internet site of obscenity, the case affirming the judgment below that the defendant's crime of violating the Act on Promotion of Information and Communications Network Utilization and Information Protection, etc. (Distribution of obscenity) and the Act on Regulation of Information Protection, etc. of Information and Communications Network Utilization and Information Protection, etc. (Distribution of obscenity) and the crime of gambling opening and gambling opening and aiding and abetting shall be deemed as serious crimes under the Act on Regulation and Punishment, etc. of Criminal Proceeds Concealment, and that bitco shall

[1] The Act on Regulation and Punishment of Criminal Proceeds Concealment (hereinafter “the Act on Regulation and Punishment of Criminal Proceeds Concealment”) is enacted with the purpose of contributing to the maintenance of sound social order by fundamentally eliminating economic factors that encourage specific crimes by preparing a fund laundering prevention system that meets international standards and prescribing special cases concerning confiscation and collection of criminal proceeds. It is an important part of the criminal law order to restrain serious crimes by supplementing the criminal law, etc. that directly punish specific crimes.

Article 2 Subparag. 2(a) of the Regulation of Criminal Proceeds Concealment provides that “property generated by a criminal act corresponding to a heavy crime or property acquired as a remuneration for such criminal act” shall be deemed criminal proceeds (Article 2 Subparag. 2(a)), and that criminal proceeds may be confiscated (Article 8(1)1) of the Regulation of Criminal Proceeds Concealment Act provides that “The Enforcement Decree of the Regulation on Criminal Proceeds Concealment” shall read “The concealed property means cash, deposits, stocks and other tangible and intangible property with property value concealed by a person whose judgment of confiscation or collection has become final and conclusive” (the main sentence of Article 2(2)).

In full view of the legislative intent of the Act on the Regulation of Criminal Proceeds Concealment and the provisions of the Act, intangible property which is recognized as having property value and acquired through a criminal act corresponding to a serious crime under the Act on the Regulation of Criminal Proceeds Concealment may also be confiscated.

[2] In a case where the defendant acquired bitcoin by violating the Act on Promotion of Information and Communications Network Utilization and Information Protection, Etc. (hereinafter “Information and Communications Network Act”) and the Act on Regulation and Punishment of Criminal Proceeds Concealment (hereinafter “Act on Regulation of Criminal Proceeds Concealment”) while operating the Internet site of obscenity, the case affirming the judgment below that the defendant's crime of violation of the Information and Communications Network Act (obscenity) and gambling and gambling and aiding and abetting are serious crimes under Article 74 (1) 2 of the Act on Regulation of Information and Communications Network Utilization and Communications Network Utilization and Information Protection, etc. (hereinafter “Information and Communications Network Act”), since subparagraph 1(g) of [Attachment Table] of the Act on Regulation of Punishment of Criminal Proceeds Concealment [Attachment Table] provides that crimes under Article 247 of the Criminal Act are crimes under Article 247 of the Criminal Act, and Article 74 (1) 24 of the Act on Regulation of Information and Communications Network Utilization and Information Protection, etc. (hereinafter “Information and Communications Network Utilization and Information Protection, etc.”) are used electronically to transfer, store and trade with the economic value of bit.

[1] Articles 1, 2 subparag. 1, 2 subparag. 2(a), and 8(1)1 of the Act on the Regulation and Punishment of Criminal Proceeds Concealment; Article 2(2) of the Enforcement Decree of the Act on the Regulation and Punishment of Criminal Proceeds Concealment / [2] Articles 32 and 247 of the Criminal Act; Articles 44-7(1)1 and 74(1)2 of the Act on the Promotion of Information and Communications Network Utilization and Information Protection, Etc.; Articles 2 subparag. 1, 2 subparag. 1, 2(a), 8(1), and (2) of the Act on the Regulation and Punishment of Criminal Proceeds Concealment; Articles 2(2)1(g) and 24 of the Enforcement Decree of the Act on the Regulation and Punishment of Criminal Proceeds Concealment

Defendant

Defendant and Prosecutor

Law Firm Shin & Yang et al.

Suwon District Court Decision 2017No7120 decided January 30, 2018

All appeals are dismissed.

The grounds of appeal are examined.

1. As to the Defendant’s ground of appeal

A. Determination as to the assertion that the confiscation of Bitcoin from the defendant cannot be forfeited

1) The Act on Regulation and Punishment of Criminal Proceeds Concealment (hereinafter “the Act on Regulation and Punishment of Criminal Proceeds Concealment”) is enacted with the purpose of contributing to the maintenance of sound social order by fundamentally eliminating economic factors that encourage specific crimes by preparing a system to prevent money laundering that meets international standards and prescribing special cases concerning confiscation and collection of criminal proceeds, thereby contributing to the maintenance of sound social order. It constitutes an important part of the criminal law order to restrain serious crimes by supplementing the criminal law, etc. that directly punish specific crimes.

2) Article 2 Subparag. 2(a) of the Regulation on the Regulation of Criminal Proceeds Concealment provides that “property generated by a criminal act corresponding to a serious crime or property acquired as a remuneration for such criminal act” shall be deemed criminal proceeds [Article 2 Subparag. 2(a)], and Article 8(1)1 of the Enforcement Decree of the Regulation on the Regulation of Criminal Proceeds Concealment provides that “The concealed property shall mean cash, deposits, stocks and other tangible and intangible property with property value concealed by a person whose judgment of confiscation or collection has become final and conclusive” (the main sentence of Article 2(2)).

3) In full view of the legislative intent of the Act on the Regulation and Regulation of Criminal Proceeds Concealment and the legal provisions, intangible property recognized as having property value may also be confiscated as being acquired through a criminal act corresponding to a serious crime under the Act on the Regulation and Regulation of Criminal Proceeds Concealment.

4) Meanwhile, Article 247(1)2 of the Criminal Act provides that a crime under subparagraph 1(g) of the Regulation on Regulation of Criminal Proceeds Concealment is a serious crime under Article 247 of the Criminal Act, and Article 74(1)2 of the Act on Promotion of Information and Communications Network Utilization and Information Protection, Etc. (hereinafter “Information and Communications Network Act”). Therefore, the Defendant’s violation of the Information and Communications Network Act (obscenity distribution) and the crime of gambling and gambling is a serious crime under the Act on the Regulation of Criminal Proceeds Concealment.

5) The crime of violation of the Information and Communications Network Act (obscenity distribution) corresponding to a serious crime as prescribed by the Act on the Regulation of Criminal Proceeds Concealment and the crime of gambling, gambling, and aiding and abetting shall be deemed as intangible property with property value. The reasons are as follows. ① Bitcoin is a kind of so-called “sOOOOO.com” (hereinafter “obscenity site”) that allows electronic transfer, storage, and transaction of economic value with digital expression of digital value. ② The Defendant operated an “OOOO.com” (hereinafter “obscenity site”) which is a obscene material distribution Internet site, and treated the users using pictures and images as having property value by receiving payment for bitcoin from the advertiser who wants to advertise and the advertiser who wants to advertise in the instant obscene site.

6) The bitcos subject to the confiscation of the instant case are specified.

7) Therefore, the lower court’s determination that the Defendant may confiscate bitcos acquired through a serious crime under the Act on the Regulation of Criminal Proceeds Concealment is justifiable in accordance with the legal doctrine as seen earlier. In so determining, the lower court did not err by misapprehending the legal doctrine on the subject of confiscation, contrary to what is alleged in

B. Judgment of the court below on the assertion that the confiscation and collection amount are improper

1) Article 8(2) of the Regulation on the Regulation of Criminal Proceeds Concealment provides that “where the property that may be confiscated pursuant to paragraph (1) (hereinafter “property subject to confiscation”) is combined with property other than the property subject to confiscation, if the property subject to confiscation should be confiscated, the part equivalent to the amount or volume of the property subject to confiscation (limited to the part related to the mixture) out of the property generated from the mixture may be confiscated.” It is possible to confiscate only the part equivalent to the amount acquired by a serious crime among the bitcos held by the Defendant.

2) The lower court determined as follows with respect to the amount of confiscation and collection as follows. ① Of BTC 216.12494 bitcos (BTC), 191.3233418 bitcos (BTC) acquired by committing a criminal act related to the operation of the instant obscene site, which is a serious crime under the Act on the Regulation of Criminal Proceeds Concealment, it constitutes criminal proceeds. ② Of the amount deposited in cash or check in the deposit account in the name of the Defendant and the Defendant’s relative, it constitutes the criminal proceeds acquired by the same criminal act, and thus, it shall be collected as a penalty.

3) Examining the reasoning of the lower judgment in light of the relevant legal doctrine and the evidence duly admitted, the lower court did not err in its judgment by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules, or by misapprehending the legal doctrine on the burden of proving confiscation and additional collection.

2. As to the Prosecutor’s Grounds of Appeal

The lower court recognized the amount of KRW 200,000,000, which was acquired by a criminal act of a serious crime under the Regulation on Regulation of Criminal Proceeds Concealment, in cash, as criminal proceeds and additionally collected the same. Examining the reasoning of the lower judgment in light of the relevant legal principles and records, the lower court did not err in its judgment by misapprehending the legal doctrine on

3. Conclusion

All appeals are dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Jo Hee-de (Presiding Justice)