VANNUCCI v. SAN MARINO
Inadmissible
Aleš Pejchal;Armen Harutyunyan;Kristina Pardalos;Linos-Alexandre Sicilianos;Robert Spano
1. The applicant, Mr Luciano Vannucci, is a San Marinese national who was born in 1949 and lives in Faetano. He was represented before the Court by Mr A. Campagna, a lawyer practising in Dogana. summarised as follows. 3. In 2009 criminal proceedings were instituted in Italy against a named individual, X, who was charged, inter alia, with issuing invoices for fictitious operations (emissione di fatture per operazioni inesistenti) and fraudulent bankruptcy to the detriment of an Italian company, C. (under the control of X and later declared bankrupt on an unspecified date). 4. In the context of the above-mentioned Italian proceedings against X, the Public Prosecutor’s Office in Milan sent a letter of request (no. 81/2009) to the San Marino judicial authorities, seeking their assistance in accordance with Article 29 of the bilateral Convention on Friendship and Good Neighbourhood between San Marino and Italy of 1939. The request was aimed at obtaining information and documents and carrying out searches in all the San Marinese banks, fiduciary institutions and companies involved with X. 5. In particular, the Public Prosecutor stated that investigations into fraudulent bankruptcy had begun after company C. had been declared bankrupt as it was suspected that the funds used to pay the abovementioned invoices for fictitious operations and other large amounts of money had been taken from the assets of company C. It further transpired that once company C. had gone bankrupt, 1,373,814.10 euros (EUR) had been transferred from a current account owned by the Italian company F. to a current account (no.1) owned by a San Marinese company, Z., via three cheques. To justify such transfers, Z. had issued a series of false sales invoices. 6. On 13 January 2009 the sum of EUR 1,273,814 had been transferred from company Z.’s current account to another current account (no. 2) that was also in its name. 7. A series of cash withdrawals amounting to EUR 1,224,500 had been made from account no. 2 and over the same period of time a similar amount had been deposited in a current account connected to a fiduciary mandate under no. MS1314/A, which had been opened on 27 February 2009 by a certain B. in his capacity as legal representative of a certain, named company. 8. On the basis of the information provided by the Italian Public Prosecutor, on 30 April 2009 the investigating judge (Commissario della Legge Inquirente), considering that all the requirements set by the law for the execution of letters of request had been fulfilled, accepted the Italian request in relation to fraudulent bankruptcy and ordered the execution of the request by means of an exequatur order. 9. The investigating judge ordered the search of a specific San Marinese bank in order to obtain all the documents and relevant information related to current account no. 1, into which the three cheques had been paid. The judge also ordered the bank to submit a copy of all the relevant documents in its possession within ten days. The judge further ordered the freezing of account no. 1 and the seizure of all the money in it, which had been traced back to X, and company Z, as well as the freezing of any other current accounts and the seizure of their contents if any money from current account no. 1 could possibly have been transferred there. In addition, any legal entities or individuals concerned, who had been notified of the exequatur order, were ordered to submit a copy of all the relevant documents in their possession within ten days. 10. On 4 May 2009 the judicial police (Polizia Giudiziaria) carried out the exequatur order by freezing current accounts nos. 1 and 2 (both belonging to company Z.), which at the time had balances of EUR 690.22 and EUR 99,460.47 respectively. Some documents related to the two current accounts were also seized during the same search. 11. On an unspecified date, one of the institutions that had been served with the exequatur order (company F.P.) informed the authorities that it administered a fiduciary mandate put in place by “one of the accused people” (the above-mentioned fiduciary mandate no. MS1314/A). As a consequence, on 6 May 2009 the judicial police seized a further EUR 1,194,290 from the current account connected to the mandate and EUR 5,000 deposited in a bearer savings book (libretto al portatore) belonging to the new administrator of company F. (a certain P.). The total sum was thus EUR 1,299,440.69. 12. On an unspecified date the Public Prosecutor’s Office in Milan sent another letter of request to the investigating judge (no. 110/2009) as a complement to letter no. 81/2009. The request was aimed at charging the applicant and another person, M., with the offence of money laundering. 13. By a decision of 8 June 2009 the investigating judge accepted the request in relation to the crime of money laundering and instructed the judicial police to identify the applicant and to question him and M. within twenty days. Moreover, considering that the alleged offence had been committed in San Marino, the judge also ordered the institution of criminal proceedings against the applicant and M. for money laundering under Article 199 bis of the Criminal Code. 14. On 22 March 2011, the Italian Public Prosecutor, in the context of the proceedings under letter of request no. 81/2009, asked the investigating judge to release all the money that had been seized so it could be returned to the bankrupt company C. and for control (affidamento) to be given to the insolvency administrator of the company who had been joined as a civil party to the Italian proceedings for fraudulent bankruptcy. The request was made after a similar one had been submitted directly by X. to the San Marinese courts on 4 March 2011. That request was attached to the one from the Public Prosecutor. 15. The investigating judge accepted the request made by the Italian Public Prosecutor by a decision of 23 March 2011. In line with Article 25 of the Council of Europe Convention on Laundering, Search, Seizure and Confiscation of the Proceeds from Crime and on the Financing of Terrorism of 2005, ratified by San Marino in 2010, the judge ordered that sums that had been seized and traced back to X should be released and returned to company C. and that control of the money should be given to the insolvency administrator of the bankrupt company. 16. On 4 April 2011, the judicial police executed the above-mentioned decision by releasing EUR 1,211,384.50 and transferring it to company C.’s current account. 17. Neither the decision of 23 March 2011 nor the subsequent police report concerning the execution of the order were ever notified or communicated to the applicant or to any other accused party in the criminal proceedings no. 665/RNR/2009. 18. By a judgment delivered in the above-mentioned criminal proceedings on 13 June 2013, filed in the registry on 23 December 2013 and notified to the applicant on 16 January 2014, the first-instance criminal judge (Commissario della Legge Decidente) found the applicant and four other people guilty of money laundering under Articles 50, 73 and 199 bis of the Criminal Code, over the period of January to April 2009. The applicant was sentenced to three years and six months’ imprisonment and prohibited for four years and six months from holding public office and exercising political rights or running a business. 19. The judge held that the applicant had had the operational role of organising the companies’ structures, which were then used to disguise the various money transfers which had constituted money laundering. According to the judge it had been shown that the money transferred to the company Z.’s current accounts had come from F. and had originally derived from the bankrupt company C. 20. The judge, applying Article 147 of the Criminal Code, also ordered the confiscation of the money that was still subject to the seizure order and which had not been transferred to company C. (EUR 104,440.69). He also sentenced the applicant and his co-accused to pay, in solidum, EUR 1,273,673.41 (the sum returned to company C.), known as “confiscation by way of equivalent measures” (confisca per equivalente), in accordance with Article 147 § 3 of the Criminal Code (see paragraph 31 below). The order was issued because it was impossible to confiscate the further amount of money considered to have been laundered as it had been returned to company C. 21. On 17 February 2014, the applicant appealed against his conviction, challenging, inter alia, the order to pay the equivalent amount of money. 22. The applicant complained that the order to pay EUR 1,273,673.41 had to be considered as an unfair duplication of the penalty against him, noting that that sum of money had previously been seized and then transferred (in accordance with the investigating judge’s decision) by way of compensation to the company that had been the victim of bankruptcy, without involving the applicant or his co-defendants. 23. The applicant complained that the inability to carry out a “direct confiscation”, which was a prerequisite under the law for applying “confiscation by way of equivalent measures”, had not been the result of any actions by him, and thus he should not have been held responsible for the payment of such an amount. 24. The applicant also mentioned the unconstitutionality of, on the one hand, the “overlapping” of compensation for victims and, on the other, the confiscation of an equivalent amount of money. He argued that that had led to an unjustified payment by those who had been sentenced. 25. On 17 March 2014 the applicant made further written submissions, reiterating, inter alia, the argument of unconstitutionality. 26. By a judgment of 8 January 2015, filed in the registry on 14 January 2015, the applicant’s appeal was dismissed by the Judge of Criminal Appeals (Giudice d’Appello Penale). 27. The judge noted that the complaint regarding the confiscation of an equivalent amount had to be considered as clearly irrelevant given the fact that Article 147 § 3 of the Criminal Code (as modified by Law no. 28 of 26 February 2004), did not provide that the prerequisite for such a confiscation order was that “direct confiscation” had been made impossible by the defendant. The judge further noted that at the time of the firstinstance judgment it had not been possible for the judge to order the direct confiscation of all the assets which had been laundered as most of them had already been transferred to company C. The judge had therefore been correct in ordering the accused, including the applicant, to pay an equivalent amount of money. 28. Article 29 of the Bilateral Convention on Friendship and Good Neighbourhood between Italy and San Marino of 1939, in so far as relevant, reads as follows: “The judicial authority of each contracting State, following a request from the other contracting State, shall notify acts, execute acts in conjunction with preliminary investigations, including the seizure of objects constituting the corpus delicti, and carry out any other act related to criminal proceedings ongoing before the abovementioned authorities.” 29. Article 25 of the Council of Europe Convention on Laundering, Search, Seizure and Confiscation of the Proceeds from Crime and on the Financing of Terrorism of 2005, ratified by San Marino on 2010, in so far as relevant, reads as follows: “1. Property confiscated by a Party pursuant to Articles 23 and 24 of this Convention, shall be disposed of by that Party in accordance with its domestic law and administrative procedures. 2. When acting on the request made by another Party in accordance with Articles 23 and 24 of this Convention, Parties shall, to the extent permitted by domestic law and if so requested, give priority consideration to returning the confiscated property to the requesting Party so that it can give compensation to the victims of the crime or return such property to their legitimate owners. 3. When acting on the request made by another Party in accordance with Articles 23 and 24 of this Convention, a Party may give special consideration to concluding agreements or arrangements on sharing with other Parties, on a regular or casebycase basis, such property, in accordance with its domestic law or administrative procedures.” 30. Article 199 bis of the Criminal Code, as amended by Chapter 2, Article 7 of Law no. 28 of 26 February 2004, and by Article 77 § 2 of Law 92 of 17 June 2008, as applicable at the time of the facts (JanuaryApril 2009) in so far as relevant, read as follows: “1. A person is guilty of money laundering, where, except in cases of aiding and abetting, he or she conceals, substitutes, transfers or co-operates with others to so do, money which he knows or should know was obtained as a result of crimes not resulting from negligence or contraventions, with the aim of hiding its origins. 2. or whosoever uses, or cooperates or intervenes with the intention of using, in the area of economic or financial activities, money which he knows or should know was obtained as a result of crimes not resulting from negligence or contraventions.” 3. If the crime at the origin of the laundered money has been committed in a foreign country, such a crime has also to constitute a prosecutable criminal offence in San Marino (deve essere penalmente perseguibile e procedibile anche per l’ordinamento Sammarinese) ... 7. The judge applies the penalty provided for the predicate offence if it is less heavy.” 31. Article 147 of the San Marino Criminal Code, as modified by Article 5 of Law no. 28 of 26 February 2004, read at the time of the commission of the offence in the present case (January – April 2009) as follows: “1. In a judgment of conviction, the Judge shall order (il giudice ordina) the confiscation of the items belonging to the convicted person which were used or were intended to be used to commit the crime, as well as the confiscation of the price, the product, and the profit of the crime. ... 3. In a judgment of conviction the Judge shall always order (è sempre obbligatoria) the confiscation of the items which were used or were intended to be used to commit the offence ex Art.199 bis (money laundering), or offences connected to terrorism, or offences with the purpose of subverting the constitutional order, as well as ordering the confiscation of the price, the product and the profit of the crime. If confiscation is not possible the Judge shall order (impone l’obbligo di) the payment of an amount of money equivalent to the value of the above-mentioned items. 4. The confiscated items or the equivalent amount of money shall be allocated to the State Revenue Service or, if necessary, destroyed.”