Study on Bona Fide Acquisition of Illicit Money

DOI: https://doi.org/10.62517/jel.202614401

Author(s)

Meixi Xia*

Affiliation(s)

School of Law, China Jiliang University, Hangzhou, Zhejiang, China *Corresponding Author

Abstract

The applicability of the bona fide acquisition doctrine to the ownership and recovery of illicit funds involving third parties unrelated to the case is a frequent issue in judicial practice. However, the Civil Code lacks explicit provisions on illicit funds and property, leading to theoretical disputes. In criminal matters, the recovery of illicit funds must trace the entire flow of the assets; whereas in civil matters, the bona fide acquisition doctrine can block the right of recovery, allowing a bona fide third party to acquire ownership of property disposed of without authority under certain conditions. This doctrine aims to protect the reliance interests and transactional security in commerce, serving as a fundamental legal principle indispensable in the era of market economy. When criminal recovery and bona fide acquisition intersect, each should govern its own domain without encroachment. When a third party claims bona fide acquisition over illicit funds, the dispute falls into the civil sphere. Therefore, conditionally recognizing the applicability of bona fide acquisition to illicit funds—discussing its rationality, legitimacy, required constitutive elements, and exclusionary scenarios—holds profound significance for safeguarding the interests of legitimate rights holders, maintaining transactional security and order, and regulating and constraining public power.

Keywords

Illicit Money; Bona Fide Acquisition; Criminal Asset Recovery; Possession is Ownership

References

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