May 25, 2017
The recent news of the decision by the Second Chamber of the Supreme Court, confirming the judgment of the Provincial Court of Barcelona, which imposed a sentence of 21 months in prison on footballer Lionel Messi for three offenses against the Tax Agency, related to IRPF for the years 2007, 2008, and 2009, the lawsuits against footballers Falcao and Coentrao, and the possible lawsuit against Cristiano Ronaldo also for the taxation of his image rights, brings back into focus the debate on the application of the well-known theory of deliberate ignorance to sanction behaviors often shielded by a supposed lack of knowledge of the criminal act.
Deliberate ignorance in Spain, or willful blindness in U.S. law—despite criticism of its translation—is a jurisprudential term used on numerous occasions to define the situation where someone, who could and should know the nature of the act or cooperation requested, chooses not to know, assuming and accepting all the consequences of the illicit act they voluntarily commit or participate in; in other words, "there is a duty to know, which prevents closing one's eyes to suspicious circumstances," and it is not possible to claim error under Article 14.1 of the Penal Code in such cases. -See, for example, the Judgments of the Second Chamber of the Supreme Court 70/2017 of February 8 or 633/2009 of June 10.-
Thus, based on modern theories of intent, which dispense with the volitional element, requiring only the presence of the cognitive element to establish the grounds for criminal liability, breaking from traditional knowledge and intent, the presence of eventual intent and the theory of deliberate ignorance become fundamental to proving the subjective aspect of the overall unjust type.
Beyond doctrinal discussions on whether deliberate ignorance is an autonomous category or simply a way of referring to eventual intent, where the fully aware actor assumes the consequences of their actions through indifference or ignorance, it is undeniable, as doctrine argues, that this formula may not meet the requirements of the principle of culpability.
In this regard, as recalled by the Second Chamber of the Supreme Court, there is a clear risk that this formula may be misused by our Courts to avoid proving knowledge, upon which the application of eventual intent is based, or even to shift the burden of proof onto the knowledge of the objective elements, with the presumption of intent not being applicable in our law, nor the elimination of probative requirements of that cognitive element. -See, for example, the Supreme Court Judgments No. 997/2013 of December 19, 2013, or No. 346/2009 of April 2, 2009.-
Ultimately, for the application of this theory as a means of proving the existence of the subjective type, prosecutors must prove the circumstances demonstrating that the author or participant placed themselves in a situation of deliberate ignorance; that is, that there were evident reasons to verify the facts, which the actor did not do because they were indifferent to whether the objective elements existed or not; in other words, it must be proven that the actor was determined to act, with significant reasons to suspect the commission of the objective type.
II. Circumstances to prove deliberate ignorance and possible crimes.
Following the definition of deliberate ignorance theory, it is necessary to provide examples of the elements that are used in forensic practice to convict the accused using the deliberate ignorance formula.
Therefore, given its current relevance in tax offenses, we focus on the judgment of the "Messi case" -SAP of Barcelona, Section 8th, July 5, 2016, Proc. 110/2015-, still pending the full content of the TS judgment, and we ask:
What were the elements considered by the Barcelona Provincial Court and now by the TS to establish the deliberate ignorance of the footballer?
Well, we all remember part of Messi's statement in court, where he said he "dedicated himself to playing football and trusted his father," an argument that evidently was not considered by the Court and the TS.
The Judgment primarily considers that:
The companies created to exploit his image rights were not domiciled in Spain or Argentina, forcing the footballer to move to other countries with reduced tax liabilities on several occasions to sign contracts.
The assignment of his rights was always made and collected through companies, involving his family members, without Messi questioning why this complex corporate structure was used, and not even knowing he was the owner of these companies.
He declared before a notary that he fully acknowledged the March 3, 2005 contract by which he assigned his image rights to his mother's company.
There was a high-value legal proceeding between Adidas and Nike over his image rights, a proceeding in which he had to appear and understand the nature of the lawsuit.
His tax returns for 2007 and 2009 resulted in refunds of €808.05 and €7,210.86, respectively, despite his high income, a fact that should have alerted the player.
In conclusion, the Barcelona Provincial Court believes that all the circumstances surrounding and accessible to the player should have generated suspicion that the income from his image rights did not have a clear and distinct origin, mainly because they were collected through companies while the actual beneficiary was the player himself as a natural person. Messi should have known what he ignored, having remained ignorant over time, "maintaining the will not to access information that could be relevant."
Another common case of the application of this formula is found in offenses against public health, where Courts understand, for example, that someone who places themselves in a state of deliberate ignorance, by ignoring the purpose of a trip or the transport of certain goods, with remuneration far exceeding the price for lawful transportation work, must suspect; they cannot remain ignorant and must know they are assuming and accepting the consequences of drug trafficking. -See, for example, Supreme Court Judgment No. 1427/2011 of December 30, 2011.-
Money laundering is another offense where deliberate ignorance is commonly applied, an offense that, according to the TS, does not require direct intent, as it is enough to place oneself in an ignorant position, able and required to know that, with their acts or cooperation, they are introducing or helping to introduce illegally obtained assets into commercial circulation to give them the appearance of legality. -See, for example, Supreme Court Judgment No. 970/2016 of December 21, 2016.-
A problem arises in the offense of money laundering in distinguishing deliberate criminal intent through deliberate ignorance from gross negligence punished under Article 301.3 of the Penal Code, replacing the intellectual element of the subjective type with reckless commission.
The TS understands that, despite the difficulty sometimes in discerning this subjective aspect of the type, actions are carried out through negligence when the individual, without knowing the origin of the assets, fails to observe sufficient caution, neglects and disregards the objective standard of care, or even violates the regulations applicable to their profession to determine the origin of the assets or refrain from operating when their origin is not clearly established, in which case, the individual would act with gross negligence.
In the recent Messi case, this author cannot comment on whether the circumstances surrounding the case truly prove Messi's deliberate ignorance; that is for the TS to decide. What is undeniable is that the FC Barcelona star is not a financial expert and has entrusted his business to his family since he was a minor, focusing on what he does best, playing football, so the deliberate commission of the tax offense in this case, in my opinion, raises doubts.
In conclusion, the deliberate ignorance formula cannot operate automatically; prosecutors must prove the accused's knowledge and representation of the objective type elements, namely, that they voluntarily placed themselves in a situation of deliberate ignorance.
Ignacio Montoro Iturbe-Ormaeche | Specialist in Economic Criminal Law and Professional Civil Liability
