Economic Crimes in Turkish Criminal Law

Introduction: Economic Crimes in Turkey

The economy, which is defined as how people produce to live, the way they divide what they produce, and the relations arising from these activities, is essential for today’s societies to survive and gain profits. The role of the economy in social life may differ according to the economic regime chosen by the relevant country.

For example, while the state’s intervention in the economy is felt at the highest level in socialist economies, in free market economies brought by liberal thought, as a rule, the state is outside the economic life and is based on the free activity of the citizens. Adam Smith’s statement, “let them do it, let them pass” reveals the perspective of the liberal economy on this issue. For this reason, it is argued that the state should not intervene in economic life, especially in free-market economies.

However, despite this, states can intervene in the economy for various reasons. These interventions can take place in the form of imposing sanctions on acts contrary to this by introducing certain criteria to protect the freedom of economic life or prevent excessive gainful transactions.

For this, the state can make regulations in the field of private law or public law. These state interventions can take the form of regulating interpersonal legal relationships under the principles of private law, enforcing specific rules under the principles of administrative law, and/or subjecting acts that violate these principles to administrative sanctions. Finally, the criminal code subjects human behavior to judicial penalties.

Competition law and energy market law can be given as examples of rules brought by administrative law, but also crimes regulated in the Turkish Penal Code and crimes regulated in special laws such as the Capital Markets Law can be cited within the scope of criminal law.

All of these regulations constitute the subject of economic law. Economic law includes the whole of the legal rules that the state put forward to regulate economic life. In economic criminal law, which is the subject of our article, the state intervenes in economic life with criminal law methods and subjects those who violate specific rules to criminal law sanctions. Definitions such as economic crime and financial crime can be made in the regulations brought by the economic criminal law, and recently the term “white-collar crimes” has been used.

Although the term white-collar or blue-collar is used to separate the worker working at the desk and the worker working in the field in our country, it is mainly used to separate the managers and workers abroad. In this sense, white-collar crimes are used to define crimes committed by company executives, although they are criticized in practice. However, this definition is insufficient to exclude crimes such as market fraud, which a manager and a desk-based stock market investment advisor can commit.

With the definition of financial crime, crimes committed to the detriment of public finances are defined, which is not sufficient since it only covers crimes such as tax crimes and money laundering.

Economic crimes, on the other hand, is a concept that can include all these definitions and regulates both financial crimes and white-collar crimes collectively. The concept of economic crime has been defined in criminology by taking into account its sociological content.

As a matter of fact, economic crimes are differentiated from violent crimes in terms of their perpetrators. Perpetrators of economic crimes are people who carry out economic activities, are experienced in this field, have high confidence in themselves, and are respected in society. Most economic crime perpetrators commit these acts not to make money from scratch but to increase their existing wealth to a much higher level. The main criterion sought in these economic crimes is to commit the act using the professional knowledge and experience of the perpetrator.

In economic crimes, both individual and supra-individual interests are observed; this means that the assets of the victims whom the crime has personally harmed are protected, and the national economy is protected with the element of trust in credit and economic relations. Suppose the state did not punish unlawful sanctions in economic life by arranging economic crimes. In that case, the perpetrators could not be prevented from carrying out these acts. Lenders or people who entered into legal relations would hesitate to have this confidence in themselves, with the thought that the perpetrator could engage in actions that would break trust without any fear.

However, thanks to economic criminal law in Turkey, individuals have the assurance that the state will intervene and protect their rights, even if their trust is not returned. Otherwise, the functioning of economic life will be damaged, and the wheels of the economy will become more challenging to turn.

However, here, the state should consider the “ultima ratio” feature of criminal law; that is, it is a last resort. What is meant by this is that criminal law is the last instrument to be used to maintain a legal order. In other words, the state should first use the resources of private law and administrative law to regulate a legal relationship, and if the unlawful act is at a level that will create a great injustice that cannot be prevented with these, it should apply to criminal law.

Economic crimes, as explained above, are crimes people commit to increase their wealth. Here, the perpetrators see their actions as “a risk that must be taken on the way to victory” and do not evaluate the unfairness of these actions as high. As an example, tax evasion perpetrators can be shown on the grounds that the taxes are too high and, therefore, the profits they get if the taxes are paid will be too low.

Crimes that can be expressed as economic crimes include; fraud crimes, counterfeiting crimes, bankruptcy crimes, drawing bad checks, crimes aimed at disrupting the capital market, trademark & ​​patent crimes, crimes against the national lottery administration, tax crimes, crimes committed to gain benefits from public officials, illegal betting crimes, etc. which are regulated in the Turkish laws.

Economic crimes have some characteristics. These are crimes with multiple victims and are usually committed by professionals or people in the same environment. They do not contain violence, and they can only be committed intentionally. They are typically committed as dangerous crimes and cause severe economic damage. They hurt the trust in economic life, misuse instruments, and are multidisciplinary.

Indeed, these crimes, due to their multi-faceted nature, cause damage to the economy, as well as shake the confidence of individuals in economic life, as a result of actions taken only intentionally, except for exceptional arrangements such as negligent bankruptcy, without the use of violence by the perpetrators, without publicity, and without the use of violence by the perpetrators. It is also processed in connection with commercial law and enforcement bankruptcy law institutions by abusing the tools.

Again, the fact that they are generally regulated as dangerous crimes, that is, even the existence of the danger of harm is considered sufficient by the legislator, even though there is no harm, shows that the interest in trying to be protected with these crimes is essentially at a high level. With these features, they differ from other crime categories.

What Are The Sanctions For Economic Crimes in Turkey?

Nations try to compensate the public and individuals for economic crimes by imposing sanctions that directly target the subject of the crime, such as seizure and cancellation of the operating license, particularly imprisonment and judicial fines, and in some cases, even plan to prevent these crimes by making the perpetrators public. Although the perpetrators of these crimes are trusted and respected in society, it will be possible for them to refrain from committing crimes with fear that they will be recognized as the perpetrator of economic crime.

Article 54 of the Turkish Penal Code regulates the confiscation of goods. According to this, the goods used in the commission of a crime or allocated to the commission of the crime or which are formed by the crime are confiscated. In Article 55, confiscation of earnings is regulated. Accordingly, the financial benefits obtained by committing the crime or constituting the subject of the crime or provided for the commission of the crime and the economic gains resulting from their evaluation or conversion are decided to be confiscated. For the confiscation of profits, the material benefit must not be returned to the victim of the crime. Again, paragraph 3 of Article 54 states that; “When it is understood that the confiscation of the goods used in the crime will have more severe consequences than the crime committed, and therefore it will be unfair, the confiscation may not be ruled.”

In the event that economic crimes are committed, the court may confiscate the belongings used by the perpetrator in the crime and the assets obtained from the crime per the provisions of this confiscation. However, in confiscating earnings, if the victims of the crime can be repaid, this should be done first. This provision supports economic crimes to protect both individual and supra-individual protection. Article 38/10 of the Constitution contains, “The death penalty and general confiscation cannot be given.” According to the provision, confiscating all the perpetrator’s assets is prohibited.

Security measures for legal persons are regulated in article 60 of the Turkish Penal Code. First, to implement this provision, it is necessary to regulate in the law that these measures can be applied regarding the crime in question. Pursuant to this provision;

“In case of conviction for intentional crimes committed in favor of the legal entity by the participation of the organs or representatives of the private law legal entity operating based on the permission given by a public institution and by misuse of the authority granted by this permission, the permission shall be canceled.“

However, in paragraph 3, similar to Article 54;

“In cases where the application of the provisions of the above paragraphs may result in more severe consequences than the act committed, the judge may not order these measures.“

The judge is given discretionary power. Again, under the provisions of Turkish Penal Code article 53 and other laws (Constitution article 76, Attorneyship Law article 5/a), sanctions are regulated in the form of prohibiting the perpetrators of certain economic crimes from certain activities (right to elect and be elected) and from performing certain professions.

What Are The Principles of Economic Crimes?

The prohibition of imprisonment for debt, one of the basic principles of criminal law, is mainly regulated for economic crimes. In the Constitution 38/8. “No one shall be deprived of his liberty merely because he is unable to fulfill a contractual obligation.” provision has been made.

The same principle is regulated by Article 1 of Protocol No. 4 to the European Convention on Human Rights and Article 11 of the United Nations Convention on Civil and Political Rights. In terms of economic crimes, discussions have come to the fore in accordance with these provisions every time, and it has been claimed that economic crimes are contrary to these norms.

However, the Constitutional Court rejected such requests on the grounds that the prison sentences in these provisions are obligations arising from the law, not the contract, in cases of disputes such as the crime of drawing bad checks and the cancellation of fraudulent bankruptcy and did not find the relevant provisions unconstitutional.

Again, one of the essential principles of economic crimes is the principle of economic sanction for economic crime. By this principle, which has been on the agenda recently, sanctions to be applied against perpetrators of economic crimes should also be economical. In Turkish law, this principle is demonstrated by applying judicial fines, primarily for economic crimes.

However, Turkish law has yet to fully adopt this principle, which also regulates prison sentences as a sanction for these crimes. Judicial fines, along with imprisonment, are also regulated as a sanction for most economic crimes in our laws. As a matter of fact, this principle has been widely criticized, and it has been stated that the perpetrators will not refrain from committing crimes with the thought of getting rid of them by paying money after committing a crime.

In our opinion, especially regarding the judicial fines imposed in addition to the prison sentence in the Capital Market Law, “If a judicial fine is imposed for this crime, the penalty to be imposed cannot be less than twice the benefit obtained.” Suppose the provisions of the form are applied together with the confiscation provisions. In that case, its deterrence will be at a very high level.

As stated above, the crimes in question are often tough to detect as the industry’s veterans commit them. For this reason, in Criminal Procedure Law, protection measures such as confiscation of assets, secret investigators, and detection of communication are provided for these crimes. It aims to detect these crimes, which are mostly committed within the organization’s scope. Again, due to a large number of financial transactions, applying to an expert is often one of the ways to detect crimes.

Conclusion

Although economic crimes are frequently committed in modern life, they pose significant dangers. Due to the economic turmoil experienced worldwide with the pandemic, the fear of these crimes has increased in society. Especially with the spread of cryptocurrencies, many economic crimes have been encountered, and states have tried to take measures in this direction. Again, due to the problems experienced in accessing food, prison sentences for acts called “stocking” were increased and included in the detention limit.

Increasing social awareness about economic crimes and punishments, which are used as a last resort in order to ensure the national economy and confidence in the economy, will also be the defense mechanism of our society against the crimes that continue to increase today.

Tagged with: MGC Legal, Özlem Hayalioğlu, Engin Berkay Uzun, White-Collar Crimes & Investigations, Turkish Criminal Law