A criminal case involving individuals identified as B.H.R. and I.R.F., who were detained by the State Security Service (SSS), has concluded in court.
According to the “Operative Information Center-OMM”, this legal proceeding marks the first time in judicial practice that cryptocurrency has been confiscated for the benefit of the state.
The Yasamal District Court found the defendants guilty under Article 206-1.3 of the Criminal Code, which pertains to the illegal transfer of large sums of money into or out of Azerbaijan through unauthorized exchange and settlement methods.
B.H.R. was sentenced to 2 years and 5 months of restricted freedom and fined 3,623,568 manats, while I.R.F. received a 3-year restricted freedom sentence and a fine of 31,399,709 manats.
Furthermore, the court ordered the confiscation of 830 units of cryptocurrency held in an account with the international virtual asset service provider "Binance," which had been seized during the preliminary investigation.
Under Article 99-1 of the Criminal Code, special confiscation involves the mandatory and uncompensated seizure of tools, instruments, or property obtained through criminal activity for the benefit of the state. Additionally, the Law "On Combating the Legalization of Criminally Obtained Property and the Financing of Terrorism" explicitly includes virtual assets within the definition of property obtained through criminal means.
The mechanism for executing the confiscation of cryptocurrency represents a significant legal novelty in Azerbaijan. As virtual assets remain a relatively new and evolving sector globally, this case highlights the growing intersection between digital finance and law enforcement. Authorities in Azerbaijan are currently working on comprehensive legislation to regulate virtual assets and crypto markets to ensure greater oversight and security in the financial sector.
