Settlement Of Bankruptcy Estate For Companies Involved In Money Laundering Cases

Abstract

The settlement of bankruptcy assets in companies involved in money laundering raises complex legal problems because it brings together three overlapping sets of norms. This normative legal research, using statutory, case and conceptual approaches, finds that the overlap lies in Article 1 point 1, Article 21, Article 24 paragraph (1) and Article 31 paragraphs (1) and (2) of Law Number 37 of 2004, which place all of the debtor’s assets under general seizure and annul existing attachments; Article 39 paragraphs (1) and (2) of the Criminal Procedure Code, which conversely permits property under bankruptcy to be seized for criminal purposes; and Article 65 paragraph (1), Article 67 paragraph (1), Article 71 paragraph (1) and Article 79 paragraph (4) of Law Number 8 of 2010, which open room for transaction suspension, blocking and forfeiture without regard to the position of the bankruptcy estate. These three groups of norms cannot be reconciled mechanically through the principles of legal preference because each is special within its own field. The proposed solution is a functional application of those principles through separation of assets by origin, with Article 39 paragraph (1) of the Criminal Procedure Code as the test, so that assets proven to derive from crime fall under the criminal regime while lawful assets remain part of the bankruptcy estate, accompanied by a duty of coordination among the receiver, the supervisory judge and investigators and the formulation of a conflict-of-seizure norm in the revision of the Bankruptcy Law.