Financial Crime World

White Collar Crime in Belarus: Bankruptcy

Belarus has witnessed a surge in white collar crime cases related to bankruptcy over the past twenty years, despite a relatively small number of prosecutions. Experts attribute this trend to the lack of attention from law enforcement authorities and the difficulty of establishing guilt.

The Criminal Code of the Republic of Belarus defines four types of crimes related to bankruptcy:

  • False bankruptcy
  • Concealing a bankruptcy
  • Deliberate bankruptcy
  • Obstruction of debt recovery by creditors

False Bankruptcy

Filing a debtor’s statement of economic insolvency with deliberately false information is considered false bankruptcy. This crime can be committed by individual entrepreneurs or legal entity representatives to avoid fulfilling obligations to creditors and take advantage of the benefits provided by bankruptcy, such as suspension of execution of obligations and prohibition of forced debt recovery.

Concealing a Bankruptcy

Concealing the fact of insolvency by providing false information, falsifying documents, or misstating accounting records is considered concealing a bankruptcy. This crime can cause large-scale damage to creditors and is often committed to:

  • Conclude transactions with counterparties
  • Obtain property without being able to pay for it
  • Hide data to protect individuals from responsibility

Deliberate Bankruptcy

Deliberately creating or increasing the grounds for insolvency of an individual entrepreneur or legal entity for personal benefit or benefit of a third party is considered deliberate bankruptcy. This crime often involves:

  • Withdrawing assets on unfavorable terms
  • Later bringing the company to bankruptcy, causing large-scale damage

Obstruction of Debt Recovery by Creditors

Concealing, alienating, damaging, or destroying property to prevent or reduce damages to creditors is considered obstruction of debt recovery by creditors. This crime can cause large-scale damage to creditors and is often committed to:

  • Protect individual entrepreneurs or legal entity officials from responsibility

Experts believe that the analysis of solvency and expertise based on accounting data complicates the objectivity of the study, making it difficult to detect such crimes.