A new amendment to the Criminal Code by the Ministry of Finance in Russia sees the regulator – for the use of bitcoin – propose up to 7 years in prison for management and executives of banks and financial services firms. For the everyday citizen adopting bitcoin, the proposed term for imprisonment is 4 years.
The latest amendment is one among a long list of proposals drawn up by the Ministry of Finance in Russia to crack down on bitcoin and other crypto and electronic currencies’ usage in the country. Regulators and those of influence in positions of government have frequently deemed bitcoin as ‘surrogates’ or money substitutes. One Russian official even deemed digital currencies as a threat to the Russian economy, in recent times.
The revelation came via a source for Interfax, a non-governmental news agency in Russia.
The latest amendment, prepared this month, March 2016, lays out the new terms for punishing those who engage in bitcoin trade or mining activities.
For normal citizens and individuals:
- A penalty of up to 500,000 rubles (approx. $7000 USD)
- If the ‘guilty’ is unable to pay the fee, he or she will have to pay with any salary or other income for the next three years.
- Alternatively, the convicted can be imprisoned for up to 4 years.
For organized groups of bitcoin enthusiasts/miners:
- A penalty of 1 million rubles. (approx. $14,000 USD)
- The transfer of any salary of income acquired between two to four years.
- Imprisonment up to 6 years.
For executives or managers at financial institutions such as banks, insurance companies, pension funds, traders etc., the punishment goes up by a few notches.
- A penalty between 1 million to 2.5 million rubles.
- The transfer of salary or any other income for a period of two to four years.
- Imprisonment of up to 7 years.
The latest proposal turns the screws further on the bitcoin usage and is significantly harsher compared to the previous version of the bill. The previous proposal suggested one year of prison sentence for individual bitcoin adopters and two years for organized groups.
The chief concern of the Finance Ministry, as revealed by the report, is the possible use of money surrogates like bitcoin in illegal activities such as money laundering.
The Finance Ministry’s latest amendment comes at a time when the central bank of Russia is actively looking to study bitcoin’s underlying technology, the blockchain, with the establishment of a new blockchain working group in Feb 2016.
Featured image from Shutterstock.