• Today, entrepreneurial activities are often accompanied by persistent risks, unreliable partnerships and breach of contractual obligations by one of the parties.

    Is there a way to think about a crime when one of the partners, as a party to the deal, has not calculated its resources for doing business? Is there a crime of fraud (Article 190 of the Criminal Code of Ukraine) in case of non-return of investment funds to one of the partners? It is important here to pay attention to the existence of the subjective aspect of the crime, the presence in this case of direct intent, as a form of guilt.

    The above issues are concerned not only with entrepreneurs who are trying to work in rather unfavorable conditions for small and medium business, but also law enforcement agencies themselves.

    In the context of the latest reforms, taking into account the fundamental personnel, organizational and structural and legislative changes in its structure, the law-enforcement system failed to eradicate negligent and indifferent attitude and reluctance to work with complex issues such as distinguishing fraud from causing damage to the owner as a result of non-fulfillment of civil obligations ” Yazan, which is a rather complex practical and theoretical task.

    And not less simple is the issue of criminal-law qualification in the absence of the fulfillment of obligations by the party to the contract, entails for another task of damages in the form of not paying the necessary amount for the delivered goods of funds, the execution of construction work, when the amount reaches a million and more hryvnia.

    In today’s conditions, there is a tendency, the essence of which is that in the financial and economic operation, its participants are at some level at risk and there is nothing wrong with this. This is due, for example, to force majeure, or a technical problem. For example, the delivery is being made, the customer has already paid a part of the amount, but the goods have not arrived, and as it turned out, there was a circumstance – the natural element prevented this. Here, of course, this can be confirmed by the certificate of the Ukrainian Chamber of Commerce and Industry

    The very existence of entrepreneurial risk is a typical phenomenon in the economic sphere, and this should be taken into account both for debtors and creditors.

    Article 190 of the Criminal Code of Ukraine provides for liability for fraud, that is, the taking over of someone else’s property or the acquisition of the right to property by deception or abuse of trust. The way of taking possession of property by fraud can be fraud or abuse of trust in any form, the crime occurs only with direct intent, a mandatory sign of the subjective side – a selfish purpose.

    A betrayal in any form for a cash investment may qualify as a fraud only if it is established in a case that such criminal misappropriation of funds was committed in order to turn them into the ownership of the perpetrator or other persons. Certainly, evidence must be provided to confirm the existence of deliberate deception or abuse of trust in the actions of the suspects with a view to obtaining free money.

    In the event that the suspect has not raised in favor or in favor of third parties the amount of money received, it was not possible to return them on time and to pay off the debt due to the lack of funds due to inefficient and unsuccessful conduct of business affairs. Non-fulfillment of contractual obligations under such circumstances entails civil liability.

    Take into account the size of the benefit. But still the amount of loss can not be a formal basis delineation of criminal and civil liability for damage from failure of the relevant contractual obligations may be much greater than the crime.

    It is important that, within the framework of criminal proceedings, the injured party has the right to file a civil suit for compensation for material damage caused by fraud.

    The distinction between crime and civil action is not quantitative (the size of income, damage), but qualitative – the presence or absence of fraud in a particular case. Although here too it is necessary to take into account the prevailing condition in the disposition of the article, respectively, as determining the amount of punishment according to the specified sanction in the specified part of Article 190 of the Criminal Code of Ukraine in accordance with the crime committed as a result.

    Therefore, the provision of training actions of individuals who have signs of deception – a necessary condition for achieving the objectives counteraction to crimes in the property sector as the correct application of the law contributes to a sense of justice people, to clearly define the scope of criminal prohibitions, knowledge of which is very necessary for the implementation of motives law-abiding behavior of the population .

    In resolving this issue it is necessary to use the rule – in the case of non-fulfillment of obligations or not return of property in the term specified by the contract property (things, money, securities), the following circumstances are subject to legal assessment:

    • The actual refusal of the debtor to return the received property (transfer thing, money, etc.), without denying the fact of its presence in the use and disposal of the debtor’s what it is, and deliberately concealing the real possibility of unhindered return the property – we are in this case we are dealing with illegal encroachment On the property itself, accordingly qualifies as a crime;
    • The actual debtor’s refusal to return property obtained (pass thing, money, etc.), without denying the fact of his presence, recalling and reaffirming the circumstances regarding the actual impossibility of performance currently commitments (eg the debtor is party damages arrested bills, etc.) – the We are dealing with civil-law relations, since the encroachment on the property itself does not occur.

    Consequently, the delineation of the crime of “fraud” from a civil-law dispute is dependent on what was the result of this contractual activity, a qualitative result.

    Both sides receive income from the financial and economic relations and remain with the owners of their property, or one party loses, but does not lose ownership of property, the substance of the relationship lies in the civil law.

    And if one party of economic relations, assuming the obligation not interested to seek any opportunity to fulfill their obligations for a long time and has no desire to fulfill the obligations previously received property from the contractor, which in turn loses Ownership of the transferred property, in this situation one can speak of signs of the composition of the crime of Art. 190 of the Criminal Code of Ukraine “fraud”.

    As to the practice of applying Art. 190 of the Criminal Code of Ukraine, certain provisions are specified in the decision of the Supreme Court in the case № 5-250кс16.

    Consequently, while continuing the issue of demarcation, it should be noted the provisions of the ruling of the Supreme Court of Ukraine.

    “By limiting fraud against civil litigation, one must proceed from the assumption that obtaining property with the condition of fulfilling an obligation can be qualified as a fraud – if it is established that the person was already in the process of appropriating this property at the time of taking possession of the property, But the obligation is not fulfilled.

    When accusing a person of committing fraud while concluding contracts of a civil-law nature, it is imperative to establish the intent of the person to seize the property at the time of receipt; In another case, the matter will be the absence of a crime “fraud” and the existence of civil-legal relations between individuals. It is possible to exclude cases when a person concludes this or that civil law contract (credit, sale, lease, commission, etc.) only in order to conceal the true nature of his actions aimed at illegal unlawful seizure of someone else’s property. As a result, there is a deception in intentions – a deception regarding the purposes for which it is planned to use the property received on the basis of a civil contract. In other words, the existence of formal (even properly executed) civil-law relations, by means of which the subject tends to veil his criminal intent, in the presence of grounds should not be an obstacle to assessing the committed as a crime envisaged by Article 190 of the Criminal Code.

    According to the case law, the peculiarity of fraud is that the person usually referred to as the victim (the owner or the person to whom the property is entrusted or protected) and the will of which is fraudulently falsified or misused, takes direct part in the transfer of property or the right to it . To qualify as a fraud, it does not matter the level of elegance of deception, the degree of caution, or, conversely, the frivolity of the victim. It is only important that, in a particular situation, the victim does not realize the fact of fraudulent use of it (abuse of trust) so that the deceitful actions of the guilty were effective in terms of the successful acquisition of another’s property (the right to it). Mandatory sign of fraud is the already mentioned voluntary transfer of property or rights to it; However, such voluntarily has a conditional (imaginary) character, since in reality the actions of the said persons in relation to the transfer of property or the right to it are due to the fact that they are misleading. Between the guilty act and the mistake of the victim who transfers the property, there must be a causal connection.

    The subjects of fraud in committing fraud include not only the owners but also other persons authorized to commit legally significant actions in relation to property. The misleading introduction of such persons gives grounds for talking about indirect fraud. Since Article 190 of the Criminal Code does not require a deceived person to commit a fraud and the victim of this crime (that is, one who suffers damage to property) coincide. “

    Consequently, the Supreme Court of Ukraine provided the necessary practical and theoretical legal clarification in order to distinguish between fraud and the existence of a civil-law dispute between counterparties.

    Separately, we want to give examples of the assessment by the investigating judges of the evidence of criminal proceedings to confirm the existence of the fault under article 190. For example, a person registered as a private entrepreneur has an account with the bank and has signed a contract for the execution of works. For a light perception of the situation imagine that the plot of the case was the contract for the manufacture and installation of plastic windows. The entrepreneur received a cash amount from the customer of the apartment owner.

    A person charged with an offense should have no intention of fulfilling an order and having an objective opportunity to do so. Within the limits of the pre-trial investigation, it was possible to prove these circumstances: first, to establish the fact that the entrepreneur did not have equipment and material (raw materials or finished constructions) for the manufacture of windows, and, secondly, the purpose of spending advance payments. That is, the money was spent on order fulfillment, or there was no intention of manufacturing and mounting anything at all. These circumstances directly create a criminal intent.

    For an example, another situation is possible. The director of a legal entity who has taken out a land plot for the construction of an apartment building concludes with a citizen an agreement on investment in housing construction or a contract of sale of property rights. The subject of the contract is a concretely defined apartment with an agreed construction condition in the future new building. But at the time of the conclusion of the investment agreement, the developer’s manager concluded and, of course, knew about the existence of another obligation on the same apartment. In the future, the construction was not completed, and the investor did not get the desired apartment. Since the developer actually twice received funds for one facility and directed the funds not to the construction, but to the Cyprus offshore companies for the purpose of personal enrichment through the control firms.

    Separately, we want to draw attention to the civil obligations that arise from so-called receipts. That is, when a loan agreement is actually concluded between citizens, which is confirmed by a debt document. The situation is very complicated, because there are no conditions for using funds and necessary requirements for fulfillment of obligations. Therefore, it is virtually impossible to prove the blame and to transfer criminal proceedings to court. In practice, most collectors’ mines have a rule about the need to open a criminal proceeding for non-fulfillment of the loan, but as a rule, the case does not continue to provide the person with explanations.

    In the proposed category of criminal offenses question often closed court verdict approval of the settlement between the accused and the victim agreed with the election of a penalty of a fine of 850 rubles .. This finale is logical for people who know how to negotiate, and most importantly each other back illegally taken. When a suspected “grief-entrepreneur” realizes his hopelessness for fraud, the lawmaking step is an agreement on reconciliation.

    The category of criminal cases is really very difficult to investigate. Since crooks have recently been using very complex, multi-combinations, such as with payment cards for retirees, wagers and volunteers to Thailand, for which a small amount of remuneration is to be credited. Therefore, it’s difficult for investigators to gather evidence sometimes because of their workload, and sometimes because of unwillingness, because much work has to be done to reveal such crimes, including disclosing bank secrecy and conducting a single search.


    Therefore, if you became a victim of fraudsters because you were previously confident in the integrity of your partner, a conscientious attitude to the fulfillment of contractual obligations, but the offender took advantage of this and seized your property by deception, our lawyers will provide the necessary legal assistance in solving the problem issue.