Mihály T
ÓTHKedves Gyuri!
Emlékszem, hogy doktori védésed alkalmával Téged a bűnügyi tudományok, ezen belül elsősorban a büntetés-végrehajtási jog „Európa-szerte ismert szakférfi aként”, hézagpótló magyar és idegen nyelvű monográfi ák, jelentős tanulmányok szerzőjeként üdvözöltelek. Akkor – a szigorú protokoll folytán – nem mondhattam el, hogy az ország egyik legkiválóbb büntetőjogásza egyben rendkívül szeretetre méltó, kedves egyéniség, aki a nehéz percekben is képes mindenkit segíteni, derűsen biztatni, tudásából, tapasztalataiból önzetlenül részesíteni. Akit az a tudósokról ritkán elmondható kiváltság jellemez, hogy minden mondata, minden gesztusa érezhetően a szívéből is szól.
Megtiszteltetés a számomra, hogy ennek én is részese lehetek, és fogadd szeretettel a következő írást.
“The Union must reduce the opportunities offered to organised crime by a globalised economy, in particular during a crisis that exacerbates the vulner-ability of the fi nancial system, and allocate appropriate resources to meet these challenges effectively. To this end, the capacity for investigation and forensic fi nancial analysis must be developed by pooling resources, in particular for training.”1
In the following short overview I would like to summarise certain present features of Hungarian economic crimes and the fi ght against them. I suppose
1 Communication from the Commission to the European Parliament and the Council. “An area of freedom, security and justice serving citizen”. http://eur-lex.europa.eu/LexUriServ/
LexUriServ.do?uri=COM:2009:0262:FIN:EN:PDF
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some of the problems will seem familiar in the countries of Central and Eastern Europe, but certainly there are some specifi c Hungarian streaks.
1) Before I introduce the structure of the status of Hungarian delinquency, I need to make a short comment.
According to Imre A. Wiener, “In the fi nal analysis, all kinds of criminal science serve a common goal, the struggle against crime. However, in the ser-vice of the common aim, they employ different means, depending on the direct tasks of the various areas of science. The direct tasks and the methods used to perform them have an impact also on the formation of concepts, since it would be senseless to operate with concepts which are incompatible with the methods of science and are not fi t to help the performance of the tasks.”2
Crimes against property have represented the majority of all crimes in Hungary for decades. (They constitute approximately two thirds of all crimes.) If we examine economic crimes, it is essential to draw the line between two criminal behaviours.
It is hard to make an explicit distinction due to the equality of the forms of property (public or private property) and the mixing and sometimes even the preconditioning of property and economic relations. According to Tiedemann, the narrower concept of economic criminal law embraces the part of criminal law where the protected legal object is the economic order organised by the State, in short, the national economy. In this economic organisation, the provisions of administrative law institutionalise the interests of the public and regulate them according to the economic policy. However, Tiedemann has broadened the concept of economic offences, classifying certain forms of property crime (fraud, mismanagement of property) among them on the basis of the way of perpetration. Such are, among others, cheque forgery, credit frauds and abuses of credit cards. He extended the concept of economic offence to embrace cer-tain offences of corruption in offi ce, if they are committed in connection with economic interests.3
It can be said that both economic crimes and crimes against property violate property relations, but economic crimes are typically related to economic pro-cesses – such as production, manufacturing, trading and distribution – while crimes against property occur in relation to violation of the actual possession
2 Imre A. WIENER: Economic Criminal Offences. A Theory of Economic Criminal Law. Budapest, Akadémiai Kiadó, 1990. 87.
3 Klaus TIEDEMANN: Wirtschaftsstrafrechts und Wirtschaftskriminalität. Hamburg, Rowohlt, 1976. 54–55. See WIENER op. cit. 50–51.
Current Challenges in Fighting Economic Crimes 187
or property situations instead of the aforementioned economic processes.
Therefore, economic crimes always violate or endanger the legal interest of certain dynamic, in-the-movement relations, while crimes against property are more static, and aimed at a certain situation or position, which includes property relations independent from progression.
It is true that such differentiation has always been fairly incidental regarding, for example, crimes violating the obligations of a trustee; besides, regarding the misuse of a computer or cash-substitute payment instruments, it does not give the right direction even today, it only indicates the basic aspects of classifi cation.
2) After clearing up the defi nitions we should try to outline the current situation.
The characteristics of the structure of the crimes that became known during the past decade is as follows:
• the number of violent turbulent crimes has not increased; it is broadly static (its proportion of the total number of the crimes committed is between 7 and 8%),
• the proportion of crimes against property has not changed either (around 55-60%),
• economic crime shows a reduction on a long time horizon; it has become more “intellectual” and results in more serious damage (around 5-7%).
According to this, an obviously slow, but almost continuous advance can be seen between the ratio of violent and economic crimes.
I should immediately add that, regarding the most recent data, the new Criminal Code causes great trouble since it entirely rearranged the structure of economic crimes, and in this regard it does not include the same criminal of-fences as the former Criminal Code. Due to this, a reliable assessment regarding the tendencies can only be available in several years’ time (of course, only if we can rely at least on the partial permanence of the current categories).
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The last decade shows the following table:4
Total number of
registered crimes Economic crimes Proportion (%)
2005 436,522 17,106 3.9
20135 377,829 13,187 3.5
2014 329,575 6,929 2.1
5
It is visible that, during the second phase of the fi rst decade of the millennium, the scale of economic crimes increased almost continuously and this progression only stopped in 2012, turned over in 2013 and continued decreasing in 2014.
It is remarkable that, from 2007 to 2011, the absolute number and scale of economic crimes increased, irrespective of the change in the total number of crimes (meaning, it applies even if its number decreases), but in recent years – irrespective of the partially different method of registration – the two indicators have decreased. The absolute number of economic crimes was at a similarly low level for the last time in 1997.
The two most serious and most characteristic problems are that, on the one hand, crimes of VAT fraud are not declining but only the manner of commission is changing6 and, on the other hand, economic corruption usually infi ltrates business relations.
4 The data shown here and afterwards are based on the numbers registered in the Unifi ed Police and Prosecutors Record System (ENYÜBS).
5 New Criminal Code from 2nd semester. This has been done since the new Criminal Code can result in certain distortion, and is not suitable for continuing the assessment of the previous trends. It is enough to refer to the fact that, for example, the new registration considers every case of illegal data acquisition as an economic crime (section 422); however, the criminal behaviour can concern personal data or privacy.
6 The European Parliament, in its resolution of 2 September 2008 on a coordinated strategy to improve the fi ght against fi scal fraud, reiterated that the existing system for managing VAT needs a radical overhaul, and urged the Commission, therefore, to submit proposals for harmonising the registration and de-registration procedures for taxable persons and for allowing Member States automatic access to non-sensitive data on their taxpayers which is held by another Member State.
Current Challenges in Fighting Economic Crimes 189
The section on Budget Fraud (our new concept: all crimes against the budget in only one section – 396) is the following:
(1) Any person who:
a) induces a person to hold or continue to hold a false belief, or sup-presses known facts in connection with any budget payment obliga-tion or with any funds paid or payable from the budget, or makes a false statement to this extent;
b) unlawfully claims any advantage made available in connection with budget payment obligations; or
c) uses funds paid or payable from the budget for purposes other than those authorised;
and thereby causes fi nancial loss to one or more budgets, is guilty of a mis-demeanour punishable by imprisonment not exceeding two years.
(2) The penalty shall be imprisonment not exceeding three years for a felony if:
a) the budget fraud results in considerable fi nancial loss; or
b) the budget fraud defi ned in Subsection (1) is committed in criminal association with accomplices or on a commercial scale.
(3) The penalty shall be imprisonment between one to fi ve years if:
a) the budget fraud results in substantial fi nancial loss; or
b) the budget fraud results in considerable fi nancial loss and is com-mitted in criminal association with accomplices or on a commercial scale.
(4) The penalty shall be imprisonment between two to eight years if:
a) the budget fraud results in particularly considerable fi nancial loss; or b) the budget fraud results in substantial fi nancial loss and is committed
in criminal association with accomplices or on a commercial scale.
(5) The penalty shall be imprisonment between fi ve to ten years if:
a) the budget fraud results in particularly substantial fi nancial loss; or b) the budget fraud results in particularly considerable fi nancial loss
and is committed in criminal association with accomplices or on a commercial scale.
(6) Any person who manufactures, obtains, stores, sells or trades any excise goods in the absence of the criteria specifi ed in the Act on Excise Taxes and Special Regulations on the Marketing of Excise Goods or in other legislation enacted by authorisation of this Act, or without an offi cial permit, and thereby causes fi nancial loss to the central budget, shall be punishable in accordance with Subsections (1)-(5).
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(7) Any person who either does not comply or inadequately complies with the settlement, accounting or notifi cation obligations relating to funds paid or payable from the budget, or makes a false statement to this extent, or uses a false, counterfeit or forged document or instrument, is guilty of a felony punishable by imprisonment not exceeding three years.
(8) The penalty may be reduced without limitation if the perpetrator pro-vides compensation for the fi nancial loss caused by the budget fraud referred to in Subsections (1)-(6) before the indictment is fi led. This provision shall not apply if the criminal offence is committed in crimi-nal association with accomplices or on a commercial scale.
(9) For the purposes of this Section:
a) ‘budget’ shall mean the sub-systems of the central budget – including the budgets of social security funds and extra-budgetary funds – budgets and/or funds managed by or on behalf of international organisations and budgets and/or funds managed by or on behalf of the European Union. In respect of crimes committed in connection with funds paid or payable from a budget, ‘budget’ shall also mean – in addition to the above – budgets and/or funds managed by or on behalf of a foreign State;
b) ‘fi nancial loss’ shall mean any loss of revenue stemming from non-compliance with any budget payment obligation, as well as the claiming of funds from a budget unlawfully or the use of funds paid or payable from a budget for purposes other than those authorised.
On the question of tax fraud and evasion, the indicators have shown an over-all negative evolution during the last 15 years:
Total crimes (A) Total economic
crimes (B) Tax fraud (C) (2013 – Budget fraud)
% (C/A) % (C/B)
2000 451,000 10,986 2,552 0.56 23
2005 437,000 16,140 2,661 0.60 16
2010 447,000 21,119 2,075 0.46 10
2011 451,000 32,490 1,602 0.36 4.9
2013 378,000 13,187 2,178 0.58 16.5
2014 330,000 6,929 2,284 0.69 32.9
Current Challenges in Fighting Economic Crimes 191
In 2016 the “Offshore phenomenon” has come back into the political and legal debate. It is important to refl ect on the question of whether these issues can be addressed and how within the existing legal framework.
In the Opinion of the European Economic and Social Committee on ‘Tax and fi nancial havens: a threat to the EU’s internal market’, the question of tax havens must be analysed in terms of three main dimensions. The tax rules and the ensuing opportunities for tax evasion; the opening up of breaches in the structure of fi nancial legislation with the resulting threat to fi nancial stability;
and the lack of transparent information with the possibility of criminal activity using havens as a platform.7
These principles are instructive and important even for us.
3) The damage economic crimes and crimes against property cause and the low proportion of it becoming recovered still reaches an alarming scale. There are damages of hundreds of billions of Hungarian Forints since the middle of the 90’s and, as can be seen, the profi ts gained in a criminal manner have increased to be one and half times greater by now.
All of the above can be seen in the following table:
Economic crimes
2005 30 12.1 104 13.1
2006 44 7.5 95 7.6
Sadly, it can be stated that, despite the decrease in the number of economic crimes committed, the damage caused by them has increased continuously in the past 5 years and its number has not been this high since the development of
7 2012/C 229/02. http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2012:229:000 7:0012:EN:PDF
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the market economy. The ratio of reimbursement, however, is steadily decreas-ing, and shows a negative low point by now.
On the average of the past decades, crimes against property and economic crimes caused approximately a damage of 150 billion HUF; of which only 15%
was reimbursed until accusation (later on supposedly more of it might not even become recovered).
This shows that the provisions of seizure, sequestration and forfeiture of as-sets do not really work effectively, despite all the legislator’s efforts.
The unspeakable situation of the scale of reimbursement could have been changed from July 2013 by the amendment of the Criminal Procedure Code (hereinafter: CPC) that introduced a new separate procedure, the asset-recovery procedure (Chapter XXVIII/B. of the CPC), but there has not been any apparent trace of it being conducted until the beginning of 2015, and there was an attempt to convert it into a functioning legal solution when the stockbroker scandals surfaced recently. Until now we do not know the results of this.
4) Unfortunately, we face the inconsistency and uncertainty of the investiga-tion (by the investigating authority, prosecutors and also judicial practice) of economic crimes that requires special preparedness, experience and interdisci-plinary knowledge on a daily basis.
The analysis of this, the consideration of the reasons and the possible solu-tions should be a subject of a thorough, more detailed examination in another presentation.
Right now, I just want to say that, in my opinion, the current tools of criminal law react to the inevitably renewed and different forms of economic crimes too late and in an inadequate manner. The legislator often shows its determina-tion by particular “judicial case law”, reacting to individual cases, sometimes introducing measures taken for the sake of keeping appearances and which are easily communicable to the public, but which are not effective. It would be great to end this point of view of legislation.