Fraud

The prosecution must prove four things: that property or a right to property was taken; that this was done by deception or abuse of trust; that the taking was unlawful and uncompensated; and, critically, that the accused intended not to perform from the outset.

That last element is where most contested fraud cases are actually decided. A person who took money intending to perform and then failed — because the market moved, the counterparty defaulted, the project collapsed — has breached a contract, not committed fraud. The distinction is the difference between a civil claim and a prison sentence.

Proving intent as at the moment of the agreement, months or years afterwards, is genuinely hard. Prosecutors do it by reasoning backwards from the failure. Defending it means restoring the sequence: what the accused actually did after receiving the money, what was performed, what was paid, what documents show attempts to deliver, and what external event caused the failure.

The parts of the article are driven by the amount. Under the notes to Article 158, which apply here, damage of a significant amount begins at 5,000 roubles, large scale at 250,000 roubles, and especially large scale at 1,000,000 roubles. Parts 5 to 7 of Article 159, which deal with the deliberate non-performance of a contractual obligation in business activity, use their own and much higher thresholds.

Because the thresholds are absolute, the calculation of loss is a battleground in its own right. Whether value added tax is included, whether part performance is credited, whether losses across several counterparties are properly aggregated into one continuing offence or wrongly combined — all of these shift the figure, and a figure that crosses a threshold shifts the part.

This is a recognised problem in Russia rather than a defence lawyer's complaint. The Supreme Court has addressed it repeatedly, most fully in Plenum Resolution No. 48 of 30 November 2017, which directs courts to establish intent as at the time of the transaction and warns against treating non-performance as fraud. Article 108 of the Criminal Procedure Code restricts pre-trial detention for offences committed in the course of business activity.

Those protections exist but they have to be invoked with evidence. The defence has to show that the relationship was genuinely entrepreneurial, that the obligation was real, and that performance was attempted. Contracts, correspondence, bank movements, accounting records and the counterparty's own conduct are the material — and much of it is held by the accused's company, which is why preserving and organising it early matters so much.

Compensating the victim does not extinguish liability under Article 159, but it changes almost everything about the outcome. It is a mitigating circumstance under Article 61 of the Criminal Code. Combined with a confession and active assistance it engages Article 62, which caps the sentence. For a first offence of minor or medium gravity it opens the possibility of terminating the case entirely under Article 76 where the victim is reconciled, or under Article 76.2 with a court fine.

Where the money can be found, this is usually the highest-value single step available — and it is the step families abroad are best placed to take.