Home Firm Overview Practice Areas Attorney Office Publications Events Recruiting Pro Bono Contact Us
 

14 F, Yinfa Building 1068 Beijing
Road (W) 200041 Shanghai, P.R.C.
ZIP: 200041
TEL:86-21-6253 3606
FAX:86-21-6253 3612
Web:www.ssplawyer.com
E-mail:info@ssplawyer.com

Home >> Publications

How to prevent fraud in China

 
Introduction
 
The act that criminal suspect gains victims’ trust and then obtains victim’s money by tricking victim through making up online information and pretending to conclude a commercial contract between them constitutes crime of Fraud in accordance with Article 266 of Criminal Law of PRC.
 

Content

1.Conception

2. Crime constitution

3.Case-filing standard

4.Penalty

5.Case-filing Procedure

6.Submitted materials

1.Conception

The crime of Fraud (stipulated in Article 266 of Criminal Law of PRC) means the act that suspect cheats a large amount of public or private property with  fabrication or concealment for the purpose of illegal possession.

2.Crime constitution

2.1 Object of crime

The object violated by crime of Fraud is public or private property.

2.2 Objective aspect

The crime is the performance of gaining a large amount of public or private property by Fraud objectively. Firstly, a person has the act of Fraud including two kinds that are fabrication and concealment. Formally and essentially speaking the act gets the victim into misconception. The performance of Fraud involves the victim into misconception and makes the victim dispose of his property as desired in specific circumstance. So either the fabrication or concealment of former fact or that of current and future fact having above-mentioned performance is Fraud. If the purpose of Fraud that is not to make victim dispose of his property is not the crime of Fraud. Fraud shall reach to the degree that could get ordinary person into misconception. Exaggeration of own goods sold within social tolerance is not Fraud. Measures and methods of Fraud are not limited whether by language or by action. Fraud itself could be performance or non-performance that is the act of the person who has the obligation of telling the fact but does not fulfil the obligation gets victim into misconception or makes victim keep misconception that the person makes use of to gain the property is also the Fraud.

Fraud gets victim into misconception and victim’s misconception is caused by the

act of Fraud..Even though the victim has some mistakes of judgement, the act of Fraud also applies.There exists victim’s misconception between the act of Fraud and victim’s disposal of his property. If victim disposes his property not because of misconception by Fraud, the crime of Fraud does not apply.The subject of Fraud could be the person not only having the ownership or possession of the property but having the right of disposing the property as well. That the person provides false statement and evidence to enable the court to give favourable judgement and gain property by means of taking civil action is called litigation Fraud and constitutes crime of Fraud.

The crime of Fraud requires victim’s disposal of property including act and consciousness of disposition after his misconception.

The person gains the property after the act of Fraud makes victim dispose his property which cause damage to victim’s property. In accordance with this Article, the act of a person who swindles a relatively huge amount of public or private property shall be taken as crime. According to relative judicial interpretations the amount of crime of Fraud is RMB 2000 as the starting point but this does not mean attempted Fraud is not taken as crime. Attempted Fraud is also taken as crime and is punishable if it is serious.

2.3 Subject of crime
The subject of the crime is ordinary subject. All natural person who has reached full legal age and the ablitiy of criminal responsibility can commit the crime.

2.4 Subjective aspect

The crime has the aim of direct intention and the purpose with illegal possession of private and public property in subjective aspect.

3.Case-filing standard

According to the Supreme People's Court on the trial of cases of Fraud of the specific application of law interpretation of several issues(effective as of December 24, 1996)

The amount of public or private property that a person swindles more than two thousand RMB is called “relatively huge amount”

The amount of public or private property that a person swindles more than thirty thousand RMB is called “huge amount”

The amount of public or private property that a person swindles more than two hundred thousand RMB is called “especially huge amount”

Especially huge amount involved is regarded as an important part of especially serious circumstances of the crime, but not only circumstance. The amount of public or private property that a person swindles more than one hundred thousand RMB and having one of the following circumstances is also regarded as especially serious circumstances:
1A ringleader of crimes group or principal criminal in a jount crime with serious circumstances;

2Habitual criminal or committing crimes from one place to another with serious hazards;

3To gain production materials in emergency of legal person, other organs or individual which effects the production and causes other serious losses;

4To gain funds and materials for relief of natural disasters, emergency rescue ,flood prevention, preferential treatment and medical aid by Fraud with serious consequences;

5To squander property by Fraud and not able to return the property;
6To use property by Fraud to engage in illegal activities or commit crimes;

7To have been subjected to criminal punishment for commission of Fraud;
8To cause victim’s dealth,insanity or other serious consequence;
9Other serious circumstances.

 
An accomplice in a joint crime shall be punished based on the amount involved in the joint crime which was regarded as the amount he swindles,his status,function and illegal gains in a joint crime according to law.
If the crime of Fraud has already been begun but is prevented from gaining property by reasons independent of the criminal’s will, it is the attemp of the crime.The attemp of the crime with serious circumstances shall be regarded as crime and be punished according to law.

4.Penalty

4.1 A persom who commits the crime shall be sentenced to fixed-term imprisonment of not more than three years, criminal detention or public surveillance and concurrently or independently, to a fine,

4.2 if the amount involved is huge or any other serious circumstance exists, to fixed-term imprisonment of not less than three years and not more than ten years and concurrently to a fine; and

4.3 if the amount involved is especially huge or any other especially serious circumstance exists, to fixed-term imprisonment of not less than ten years or life imprisonment and concurrently to a fine or confiscation of property.

5.Case-filing Procedure

Case-filing procedure mainly includs accepting case-filing materials, examining materials and handling after examination.

5.1 Accepting case-filing materials

According to Article 84 of criminal procedure law of PRC, the public security organ, the People's Procuratorate or the People's Court shall accept all reports, complaints and information whether or not a case falls under its jurisdiction. Then it shall refer the case to the competent organ. The officer receiving an oral report, complaint or information shall ask or interrogate reporter carefully and make a written record of it, which, after being read to the reporter, complainant or informant and found free of error, shall be signed or sealed by him or her.

The officer receiving the complaint or information shall clearly explain to the complainant or the informant the legal responsibility that shall be incurred for making a false accusation and ask them to seek truth from facts and stick by the truth and law. However, a complaint or information that does not accord with the facts, or even a mistaken complaint shall be strictly distinguished from a false accusation, as long as no fabrication of facts or falsification of evidence is involved. As false accusation is act of the person who deliberately fabricates the fact and evidence and airly accuse other person’s crime, mistaken complaint is misconception that causes the discrepancy between what is complained and fact. They are in distinct natures. The former is deliberate act that shall be investigated for legal responsibility according to law. The latter shall not be investigated for legal responsibility and the officer shall explain the case to the complainant or the informant to enable him to accept the .lesson.

The public security organs, the People's Procuratorates and the People's Courts shall insure the safety of reporters, complainants and informants as well as their near relatives. If the reporters, complainants or informants wish not to make their names and acts of reporting, complaining or informing known to the public, these shall be kept confidential for them during the criminal action.

    However above-mentioned regulation is not limited during trial stage. According to Article 47 of criminal procedure law of PRC, witness shall testify before the court otherwise all reports, complaints and information he provides could not be used as a basis in deciding a case. Thus in this case, the officer shall give the reasons and ask the witness to tesity before the court or agree to make their names and contents of reporting, complaining or informaing known to the public.

In judicial practice, reporting anonymously shall be analyzed concretely. On the one hand, as complainant is afraid of retaliation and reports anonymously, so the reports,complaints and information he provides are possibly true and of evidence meaning, on the other hand the materials reported anonymously are only used as clues of case-filing which can not be used as a basis of case-filing.

 

5.2 Examining case-filing materials

The following steps and methods are taken generally:

5.2.1 Fact examination. Firstly to examine whether the case occurred and then to examine whether the happened event was criminal case. If it was, to examine whether the performer shall be investigated for the criminal responsibility.
5.2.2 Evidence or clues examination. The common way is:

to ask or interrogate reporters, complainants and informants;

to gather evidence materials concerning the criminal facts and suspect from relevant unit or organs;

if necessary, to entrust relevant unit or organs to investigate some issues;

necessary measures of special investigation may be taken in emergency for special case;

Investigation in case-filing stage is to know the fact concerning crime and it is limited to find out whether the cirminal event occurred and shall be investigated for criminal responsibility.It could not be expanded.

5.3 Handling after examination

After the public security organs’ examination and necessary investigation of the case-filing materials, it shall be dealt with according to different cases:

1. To the case that need to be filed, the undertaker shall fill out case-filing report form including filing unit, case type, no., when and where case happened, casuaities,property converted,name of undertaker who summed up the case and time of filling out the form etc.,.Then make case-filing report for approval. After the approval of person in charge of own organ or department, make case-filing decision. Eventually, person in charge of approval sign or seal on the decision. If the case shall be directly accepted by the People's Procuratorates, submit the case to superior People's Procuratorate for record. Superior People’s Procuratorate shall notify the inferior People's Procuratorate to cancel the case in writing if it is thought to be not filed

2. To decide not to file the case and go through the corresponding legal formality

Personnnel shall make notification of not filing the case for decision of not filing the case.After the approval of relevant person in charge, reporters, complainants or informants shall be told the reason of not filing the case. If reporters, complainants or informants disagree, they may apply for reconsideration. Competent organ shall carefully reconsider it and tell the outcome to unit or person who reports, complains or inform.
If the case of private prosecution is not in accordance with the standard of filing the case, decision of not filing the case shall be made in fifteen days and the private prosecutor shall be notified the decision in writing and the reason of not filing the case. For the case that is not in accordance with the standard of filing the case but it is necessary to give sanctions to relevant persons by other organs, reports, complaints and information shall be transferred to competent organs and
reporters, complainants or informants shall be notified.

6.Submitted materials

Generally speaking, reporting materials shall indicate the name of repoter, facts and reasons and specific requests. If having evidence, relevant evidence or clues shall be attached.

PageView: 1942
Simon Shang & Partner © 2008 Please read our disclaimer