"Self-laundering" of proceeds from business operated contrary to tax legislation
Supreme Court judgment 7 May 2021, HR-2021-987-A, (case no. 21-002283STR-HRET), criminal case, appeal against judgment.
A (Counsel Bernt Heiberg) v. The Public Prosecution Authority (Counsel Peter Andre Johansen)
Justices: Matningsdal, Bull, Bergsjø, Ringnes, Bergh
The owner of a moving firm had established several nominee companies as fictitious sub-suppliers of services, making use of black labour. The moving firm apparently leased employees from the nominee companies and was invoiced by them for fictitious services. The money that was paid was transferred further. The owner had been convicted in the Court of Appeal of money laundering in the form of self-laundering, see section 337 subsection 1 (b) of the Penal Code, and for other economic offences and sentenced to five years and six months of imprisonment. The Supreme Court stated that to be convicted of self-laundering, the offences from which the self-laundered proceeds stem (the primary offences) must be identified in such a manner that the defendant may defend himself against the charges. When it involves continuous offences, however, the duty to specify does not exceed what otherwise applies to such offences. When, like in this case, it involves a complex system where the concealment system itself of was part of the self-laundering, the requirement that the primary offence must have preceded the self-laundering, must be considered to be met without it being necessary to attach each self-laundering act to a specific primary offence. Unlike the Court of Appeal, that had regarded all the transfers to the nominee companies as proceeds, the Supreme Court found that the proceeds from the primary offences consisted of the margin between the transferred amounts and the expenses the defendant had incurred for employees and helpers etc. The proceeds were then reduced from approximately NOK 18 million to approximately NOK 9 million. As a result, the sentence was reduced to four years and nine months of imprisonment. The Court of Appeal's determination of the confiscation amount was upheld with the change that the confiscation amount was reduced by the proceeds that the company's bankruptcy estate had paid to the Tax Office.