In what cases can you be imprisoned for debts?

Responsibility for non-payment of a loan in Russia

In each loan agreement, the bank indicates what consequences and under what circumstances will occur for the borrower in the event of failure to timely fulfill debt obligations to the financial institution.

If you fail to repay your loan, you risk facing the following negative consequences:

1. Deterioration of credit history . Banks are required to transmit to the Credit History Bureau all information about the borrower and his loan. The BKI records all the data: the total amount, payment terms, monthly payments, whether they were made on time, whether there were fines, etc. The more information about your overdue loans, the worse the conditions for further lending are for you. Banks have the right to refuse a loan and offer lending on the most “predatory” terms for you.
2. The loan agreement must stipulate fines and penalties for non-payment of loan obligations. “Penalty” interest is accrued for each day of delay, so the total amount of debt to the financial institution is constantly increasing.
3. If the borrower does not fulfill his obligations for several months and does not make contact with representatives of the banking institution, the bank can sell this debt to a collection organization . They will “knock” money out of the borrower using all available (and not always legal) methods. The debtor will be subjected to a flurry of calls, letters, and possible visits to his home or work with a reminder of the debt and the need to repay it. And although such actions are illegal, finding justice for debt collectors is not always easy.
4. A financial organization has the right to file a complaint against a persistent defaulter with the relevant government agencies. As a result, the debtor’s driver’s license may be taken away or travel abroad and even movement within the country may be restricted.

In what cases do banks sue?

According to the law, a bank or other financial institution has the right to file a lawsuit from the very first day of a late payment.

But in fact, they are in no hurry to do this and consider the following circumstances:

• the total amount of debt to the creditor;
• client's deadlines;
• accrual of penalties or other penalties.

It is beneficial for the lender to maximize the profit from each loan. Banks take into account that litigation involves a waste of time and effort. You must file a claim, pay all the necessary fees, attend all meetings, and pay for the work of a bank lawyer.

For the sake of small amounts (up to 100,000 rubles), not all banks decide to take legal proceedings. In such cases, the institution’s security service and special departments for working with debtors are most often involved. They will constantly remind you of the need to pay off the debt. However, there are also organizations that are ready to file a claim for debts in the amount of 15 thousand rubles.

Large players in the market (Sberbank, VTB, Gazprombank and others) value their reputation and do not cooperate with collectors, but they also do not forgive debts. They have a large staff of lawyers who deal with just such cases. The larger the amount of debt, the more likely it is that the case will go to court.

Can they go to jail for this?

Imprisonment may be imposed for non-payment of debt in cases where fraud is proven and the total amount of debts is more than 1.5 million rubles.

In this case, the following facts must be proven:

• to obtain a loan, the borrower provided false documents;
• the debtor has no real ability to pay loan obligations;
• The bank client almost immediately stopped repaying the loan, without explanation.

Eviction from the only home with a mortgage

If the debtor’s only home is under a mortgage, according to the situation in 2021, they can actually be evicted from it. The loan agreement with the bank stipulates that if payment is not made, the bank may file an application with the court to foreclose on the apartment.

The threat of being left without an apartment if it is mortgaged exists both among debtors who have other real estate and among those who do not.

Read an article in a newspaper with the participation of a financial manager and our client: “Life on credit, or how to avoid falling into a debt trap”

How does the process of “eviction” from the only housing occur?

According to the bill, the forced sale of housing for debts can only be carried out by a corresponding court decision. There are corresponding regulations that concern the features of the debtor’s house or apartment, area and cost. If the court rejects the claimant's claim against the owner, the sale of the living space will be considered illegal.

In a case involving debts with subsequent possible eviction, the court must hear the following parties:

• claimant;
• debtor;
• debtor's family members.

The court decides not only the question itself, whether to evict the debtor from the only home or refuse the claimant, but also, in the case of a positive decision in favor of the plaintiff, the amount for which the former owner has the right to buy a new home.

You must decide to purchase a new apartment within 90 days. Otherwise, the funds allocated for this go to the state budget. Local governments provide assistance in finding housing.

The authors of the bill and debt collectors believe that for debtors, the real risk of eviction from their only home will increase payment discipline.

There are several categories of individuals who cannot be evicted from their apartment:

• disabled people of groups I and II;
• minors whose parents have no other housing;
• dependents of the owner;
• single parents;
• those who executed a testamentary refusal;
• those who received real estate under a marriage contract;
• refused privatization in favor of the owner.

The legislation is on the side of the owners and does not allow eviction from the only home in most cases. Neither collection services, nor collectors, nor bailiffs can kick you out of an apartment - this is done only by court decision. If this is initiated by the state, the citizen will be offered housing of equal value. The bill only allows for eviction from a mortgaged apartment or seizure of real estate for debts on alimony and compensation for harm to health.

In what cases is criminal punishment possible?

The Criminal Code of the Russian Federation provides only 4 articles that regulate the imprisonment of persons who have assumed financial obligations and do not fulfill them:

• Art. 159 “Fraud in the field of lending.”
• Art. 165 “Intentional infliction of damage.”
• Art. 176 “Illegal receipt of a loan.”
• Art. 177 “Malicious evasion of debt payment.”

None of these articles provide for criminal liability if the borrower really does not have the funds or ability to repay the loan on time. The fact of the absence of property is established during government inspections: a request to the cadastral chamber, tax service, pension fund. At the same time, malicious evasion of debts, if any, must be proven in court, and this is not always easy to do.

Fraud when obtaining a loan

Article 159 of the Criminal Code of the Russian Federation is applied when a set of circumstances is established:

1. The loan was issued fraudulently, namely, false documents were provided, information about the amount of wages or the real financial burden of the individual was distorted.
2. The person taking the money did not consciously intend to repay the loan funds received to the bank.

The article provides for punishment in the form of restriction of freedom or forced labor for up to 2 years. Forced labor can be replaced by arrest for up to four months.

Attention! If the debtor, having provided false information about himself, was going to pay the loan on time, then it will not be possible to bring him to criminal liability. One payment made by him is enough to confirm the fact of his desire to repay his financial obligations.

Intentional damage to the bank

Liability under Article 165 of the Criminal Code for causing intentional damage to a banking organization occurs in cases where the debtor did not repay the loan or interest on it, acting fraudulently.

Fraudulent actions include:

• providing false income certificates;
• deliberate overstatement of income;
• deliberate concealment of the amount of debt obligations of an individual.

The severity of the punishment is determined depending on the amount of damage. If the borrower caused damage worth 250,000 rubles, he faces up to 2 years in prison. Damage of 1 million rubles is punishable by 5 years in prison.

Malicious evasion of loan repayment

The fact that the debtor transfers ownership of his property to other persons (relatives) in order to avoid debt collection through the sale of property is considered to be malicious evasion of settlement of credit debts.

Can minors be jailed?

Teenagers are citizens with an unformed psyche; they can easily fall under bad influence and break the law. They can be deceived and lured into criminal business. Taking into account the fact that children do not always understand and realize their actions, the state gives them the opportunity to correct themselves in a special institution rather than in prison.

The law considers minors who are criminally responsible for a crime committed to be persons aged 14 to 18 years (Article 87 of the Criminal Code of the Russian Federation). They can be tried and given a fine or correctional labor, which they can perform without harm to their health. The fact that a teenager does not work does not give him the right not to pay a fine - his parents do this (Article No. 88 of the Criminal Code of the Russian Federation).

As for imprisonment, minors are sentenced to no more than 6 years, and if the crime is particularly serious, then no more than 10. The court is guided by the principle that the maximum punishment for such crimes committed by adults is halved for minors. So, if an adult would be sentenced to 20 years for a brutal murder, then a teenager would be sentenced to 10 years and not go to prison.

Who will have to repay the loan if the borrower is imprisoned

If the debtor has been brought to justice and is serving his sentence, it means that enforcement proceedings are already underway in his case. To pay off a debt to a bank, bailiffs can seize the debtor's accounts and property and sell it.

If the debtor is serving a sentence in connection with another type of criminal liability (not related to loans), the obligation to repay the debt to the bank is not removed.

If the borrower is in prison, the loan debts are paid for him by:

1. Guarantor or co-borrower. This solution to the situation applies in cases where a loan is issued for two people, for example, if a spouse takes out a mortgage together.
2. Relatives, friends. By agreement, in order to avoid the accrual of fines and penalties, the arrested borrower can agree to make loan payments for him.

If the contract period is short (up to 1 year), the bank may provide a deferment. To do this, the borrower contacts the bank with a written application describing the reason for the deferment. The right to satisfy the request or refuse remains with the banking institution.

If there is no one to make payments for a debtor serving a sentence (there is no guarantor, relatives do not agree), the bank has the right to go to court. In this case, the borrower can only wait for a court decision. The debtor, while serving his sentence, can turn to a trusted person or relative with a request to sell part of his (the debtor's) property and repay the loan before filing a claim from the bank.

Is a children's colony the same as a prison?

In educational colonies, several types of regimes are observed, depending on the severity of the crimes committed: ordinary, strict, lightweight, preferential (Article 132 of the Penal Code of the Russian Federation). The rules here are similar to those in prison: if a young offender behaves well, no punitive measures are applied to him or he is not put in a punishment cell. Subsequently, such teenagers are transferred to easier living conditions.

Malicious violators are subject to strict conditions of detention; they can be sent to a punishment cell, and this is the same prison. Those who are convicted for the first time are in normal conditions, and with good behavior they find themselves in better conditions. In case of violations, they are placed in more strict conditions.

In accordance with the regimes, a schedule of visits to juvenile offenders is built: from 8 short visits and 4 long ones (standard) to 6 long ones (preferential). Minors live in special dormitories, and persistent offenders live in isolated rooms. Therefore, the daily routine is carried out impeccably, although children are treated more loyally than adult criminals who are sent to prison.

Among the rules that are observed in the colony are the following:

• boys and girls are placed in different blocks;
• the number of working hours meets the requirements for each age;
• teenagers do sewing, make furniture, as well as clean the room and prepare food;
• work on weekends and at night is prohibited;
• children must necessarily study subjects included in the school curriculum;
• special classrooms are equipped for training;
• half of their earnings are transferred to the personal accounts of juvenile delinquents;
• every day begins with construction.

According to Articles 135 and 136 of the Penal Code, a minor citizen staying in an educational colony can be punished and receive incentives from his superiors. These measures are taken only in accordance with the behavior of the minor.

The fate and term of each of them is decided in two ways: after reaching the age of 18, they either go free or are transferred to an adult correctional colony (that is, they are sent to prison). It depends on three people: the student himself, his boss and the prosecutor who is handling the case.

Sources:

Criminal liability of minors

Features of criminal liability and punishment of minors

Types of punishments imposed on minors

Sentencing a minor

What to do if you can’t pay a loan - how to avoid problems with the law

The best way to avoid credit problems is to fulfill your credit obligations on time. If you have become a victim of circumstances and have lost the ability to fulfill your obligations, it is recommended to take a number of measures that will help you avoid problems with the law.

1. Inform the bank about your financial insolvency and justify its reasons (documents will be needed - a certificate of health, loss of ability to work, confirmation of loss of the main source of income).
2. Ask the credit institution to introduce you to credit holidays. Most organizations give clients a deferment of 1-6 months.
3. If the amount of debt is above 500,000 rubles, your property does not cover this amount and there are no prospects for receiving income with which you can pay off the debt, you have the option of going bankrupt and applying for loan restructuring.

Important! Record all your contacts with bank representatives in writing or record them on a voice recorder. This way you can prove your interest in solving the problem and eliminate accusations of fraud.