Today, the 'Two Highs and One Ministry' released the 'Opinions on Handling Criminal Cases Related to Assisting Information Network Criminal Activities', along with seven typical cases and a Q&A with department heads. Among them, the fourth typical case involves a virtual currency-related case. Relevant departments emphasized that a gray and black industrial chain specializing in providing virtual currency 'money laundering' has already formed, and they will focus on cracking down on such crimes.
01 Typical Case:
Defendant Wang and others concealing and hiding criminal proceeds case - severely punish the crime of transferring stolen funds through virtual currency transactions.
1. Basic Case Facts: In mid-July 2022, defendants Wang, Zhang, and Zhao conspired to transfer criminal funds for others through methods such as transfers, withdrawals, and purchasing virtual currency for illegal profits. The three had clear divisions of labor: Wang provided funds, Zhao purchased virtual currency with them and handed it to an upper-level contact as a deposit, while Wang and Zhang acquired a large number of bank cards from others to provide to the upper-level contact for receiving criminal funds. Once the criminal funds were deposited into the bank cards provided by Wang and others, the upper-level contact notified them. Wang and others arranged for someone to withdraw cash from multiple banks in Daqing City, Heilongjiang Province, taking a commission of 10%-15% of the funds received, and then purchased virtual currency with the remaining funds to transfer to the upper-level contact. It was found that during the period from August 5 to 14, 2022, Wang and others transferred funds for the upper-level contact, with 15 victims including Lin being defrauded of more than 400,000 yuan.
2. Litigation Process: The People's Procuratorate of Acheng District, Harbin City, Heilongjiang Province, filed a public prosecution against Wang, Zhang, and Zhao for concealing and hiding criminal proceeds. After legal proceedings, the People's Court of Acheng District, Harbin City, sentenced Wang and Zhang to three years and six months in prison and fined them 30,000 yuan each, while Zhao was sentenced to three years and three months in prison and fined 25,000 yuan. After the verdict, Wang, Zhang, and Zhao appealed, but the second instance upheld the original judgment.
3. Typical Significance:
(1) Severely punish acts of transferring stolen funds through virtual currency transactions. With the increasing crackdown on telecom network fraud and enhanced financial supervision, the difficulty of transferring illegal funds directly through bank accounts and payment accounts has increased, prompting criminals to resort to more concealed virtual currency transactions, complicating the recovery of stolen funds. Severely punishing such crimes helps to timely sever the chain of criminal fund transfers, curb the spread of telecom network fraud and other crimes, and fully protect the property safety of the people while maintaining financial regulatory order.
(2) Eliminate surrounding gray and black industrial chains to curb the breeding and spread of related crimes. Utilizing virtual currency to transfer stolen funds is concealed and convenient, leading to a high incidence of fraud and other crimes related to virtual currency, which has formed a specialized gray and black industrial chain providing 'money laundering' services. Severely punishing such crimes helps to curb the emergence of gray and black industries at the source, compress the space for gray and black industries, and dismantle the 'funding hub' of crimes, thereby comprehensively and thoroughly cracking down on information network crimes.
02 The latest opinions from the Two Highs and One Ministry:
In the 'Opinions on Handling Criminal Cases Related to Assisting Information Network Criminal Activities' released by the Supreme People's Court, the Supreme People's Procuratorate, and the Ministry of Public Security, the key content related to virtual currency crimes is summarized and briefly interpreted as follows:
1. Further clarify the responsibilities of principal offenders and accomplices, with minors and students receiving lenient treatment: The opinions emphasize that for organized, professional, and cross-border criminal activities, severe punishments should be imposed on organizers, planners, commanders, and key members; while minors, students, and those at the end of the criminal chain with lighter circumstances should be treated more leniently according to the law.
Among them, organized, professional, and cross-border crimes emphasize behaviors that involve 'organizing or long-term engaging in the illegal activities of acquiring and selling others' bank accounts, payment accounts, unit bank accounts, unit payment accounts, phone cards, IoT cards, and internet accounts.'
2. Key elements in determining the composition of assisting network crimes: Based on the time, method, frequency, tools, and related behaviors of the assistance provided, whether such behaviors violate legal prohibitions, whether the actor evades supervision or investigation, and whether illegal profits are involved, along with the actor's cognitive abilities, professional identity, past experiences, relationship with the assisted party, as well as their statements and defenses, should be comprehensively evaluated. Misunderstanding the types of information network crimes does not affect the determination of 'knowingly'.
3. Providing illegal contact methods will directly imply that the individual is 'knowingly' involved: (1) Illegally providing bulk phone cards inserted into devices, illegally providing devices or software with functions such as changing caller ID numbers, virtual dialing, or illegally accessing public telecom networks; (2) Continuing to engage in related behaviors after being restricted or suspended by financial institutions, telecom operators, or internet service providers due to abnormal circumstances related to fraud; (3) Preparing responses in advance for investigations.
4. New key thresholds for criminalizing assistance in network crimes: (1) Selling or renting out one's bank account or payment account more than three times, with account inflow exceeding 300,000 yuan; (2) Acquiring, selling, or renting out non-personal bank accounts, payment accounts, or unit bank accounts, with account inflow exceeding 300,000 yuan; (3) Acquiring, selling, or renting out more than twenty phone cards or IoT cards.
5. Greater space for criminal defense: For those who have been misled into committing crimes, participated for a short time with little profit, confessed and pleaded guilty, actively cooperated with the police and played important roles, or are minors or students, leniency or even non-prosecution or exemption from criminal punishment can be sought.
6. Accurately distinguish between the crime of assisting information network criminal activities and the crimes of concealing or hiding criminal proceeds and criminal proceeds benefits: In the field of virtual currency crime, the main difference between the two crimes lies in whether the perpetrator has a vague or unclear knowledge of others committing a crime or is fully aware of a specific crime being committed by others while still providing virtual currency for RMB conversion. The threshold for the crime of concealing is lower than that of assisting crimes, but the maximum penalty is higher than that for assisting crimes. Courts strive to accurately differentiate between these, making criminal defense for downstream crimes more operable.
03 Q&A with Journalists
Q: Could the public security agency introduce the situation regarding the crackdown on 'two-card' illegal activities in recent years?
A: According to information held by public security agencies, the abuse of phone cards and bank cards remains one of the significant roots of the ongoing high incidence of telecom network fraud cases. The Ministry of Public Security places great importance on cracking down on and governing 'two-card' illegal activities, conducting the '断卡' (cutting off cards) operation together with the Ministry of Industry and Information Technology, the People's Bank of China, the Supreme People's Court, and the Supreme People's Procuratorate for several consecutive years, severely cracking down on illegal operations and sales of 'two-cards', achieving significant results. Since the beginning of this year, the Criminal Investigation Bureau of the Ministry of Public Security has issued 780,000 leads for '断卡', investigated 230,000 suspects involved in 'two-card' illegal activities, dismantled over 5,500 illegal card-opening gangs, confiscated over 170,000 illegal 'two-cards', and arrested 23 'insiders' from banks and telecom operators. While strengthening the crackdown, the Ministry of Public Security, in collaboration with the National Development and Reform Commission, the Ministry of Industry and Information Technology, and the People's Bank of China, continues to promote joint punitive measures to effectively squeeze the space for crime.
Nonetheless, the current crackdown on 'two-card' illegal activities faces many challenges. For instance, the issue of 'two-card' holders not being real persons remains prominent, as some telecom fraud gangs acquire large quantities of real-name phone cards and bank cards from others, even organizing and utilizing minors, students, and the elderly to commit crimes. In response to such situations, the 'Opinions' specifically set out provisions detailing eight scenarios for strict legal punishment, providing strong legal tools for public security agencies to severely crack down on organized, professional, and cross-border collaborative activities in assisting information network crimes.
In practice, the public security agencies should accurately distinguish between assisting crimes and complicity in fraud according to the provisions of the 'Opinions'. Those who knowingly assist others in committing fraud and have established a stable collaborative relationship should be treated as accomplices in fraud, and must not be simply considered as 'helpers'; they should accurately grasp the balance of leniency and severity criminal policy, adhering to the principle of 'education, persuasion, and rescue' for minors and students, providing leniency under the law; but special forces must be organized to strengthen investigations and thoroughly investigate behind-the-scenes organizers and instigators, imposing severe punishments under the law without mercy.
In the next steps, the Ministry of Public Security will continue to thoroughly implement General Secretary Xi Jinping's important instructions, maintain a high-pressure stance against telecom network fraud crimes, and strive to cut off the illegal operation and sale of the 'two-card' gray industrial chain, firmly curbing the high incidence of telecom network fraud and illegal activities. The public security agency also takes this opportunity to remind the public not to be tempted to rent out, sell, or lend their bank cards or phone cards for small profits, to avoid becoming accomplices of fraudsters.
Q: Currently, some minors and students are suspected of assisting crimes, which has become a hot topic of social concern. What response and provisions does the newly released 'Opinions' have for this?
A: With the continuous crackdown on telecom network fraud and other crimes, criminal gangs often exploit the naivety and lack of social experience of minors and students, inducing them to rent out or sell phone cards, bank cards, payment codes, or participate in 'money laundering' activities, even developing them into 'card heads' and becoming accomplices in telecom fraud. Minors and students are the hope of families and the future of the country. The 'Opinions' propose overall requirements for lenient punishment of minors and students involved in cases, establishing provisions for 'accurately grasping the criminal policy for groups like minors', stipulating that for minors involved in cases, the principle of 'education, persuasion, and rescue' should be adhered to, and that those with minor criminal circumstances should generally not be prosecuted or exempt from criminal penalties, while those with significantly minor harm should not be treated as criminal acts under the law. Additionally, the 'Opinions' stipulate that the handling agencies should actively carry out legal education and publicity, cooperating with educational administrative departments and schools to manage education and legal publicity for minors and students. These provisions provide legal and policy support for handling cases involving assisting crimes and minors and students.
It should be emphasized that for minors and students who are not subject to criminal conviction, they should not, and cannot, be simply 'let go without any concern'. 'No criminal punishment' does not mean 'no oversight'. Exemption from criminal punishment does not equate to immunity! The relevant provisions of the 'Opinions' must be followed to ensure effective execution. Additionally, efforts should be made to thoroughly investigate and crack down on those who organize and utilize minors and students to commit crimes, imposing severe punishments under the law without leniency!
Q: In recent years, what work has the procuratorial organs carried out in combating and managing crimes related to assisting information network criminal activities and telecom network fraud, and what achievements have been made?
A: In recent years, telecom fraud and other network crimes have surged, with the network black and gray market exacerbating the situation. For instance, illegally providing internet technology to facilitate network attacks, extortion, fraud, or providing assistance in transferring assets has caused massive property losses to the people and posed significant social harm. It is the duty of the procuratorial organs to crack down on and govern criminal activities related to assisting network crimes. The procuratorial organs implement the requirements set by the Central Committee, adhering to a people-centered approach, fully utilizing the functions of criminal prosecution, civil prosecution, administrative prosecution, and public interest litigation, and insisting on combining severe legal punishment with promoting governance, actively purifying the cyberspace, and maintaining people's legitimate rights.
First, adhere to a comprehensive crackdown to effectively destroy criminal networks and organizational structures. For those who knowingly provide technical support or assistance to others committing crimes using information networks, a comprehensive crackdown and strict legal penalties should be applied. For example, those who provide assistance to upstream crimes such as telecom network fraud and online gambling, which pose significant social harm and serious circumstances, should be accurately recognized as assisting crimes and crimes of concealment, increasing criminal prosecution efforts, precisely targeting the technical, financial, and informational flows associated with cyber crimes, cutting off technical support, funding channels, and communication chains for upstream crimes, and dismantling the survival foundation of telecom fraud and other crimes.
Second, adhere to a combination of leniency and severity to ensure that the educational and punitive effects of penalties are maximized. In judicial case handling, the procuratorial organs comprehensively consider factors such as the subject identity of the perpetrator, subjective malice, performance after the act, nature of the act, and social harm, and lawfully make accurate decisions on the case, being lenient where appropriate and strict where necessary, in a balanced manner, with penalties proportional to the crime. Differentiate criminal circumstances, and impose severe punishments for organized, professional, and cross-border assisting crimes, while handling less serious assisting crimes more leniently. Differentiate between offenders, imposing severe punishments on organizers, planners, commanders, and key members, while treating ordinary participants and those who are misled into committing crimes, especially minors and students, more leniently. Differentiate based on post-crime behavior, combining leniency for confession and restitution with efforts to recover damages, providing leniency under the law for those actively returning stolen funds or cooperating with law enforcement. The goal is to maximize the effectiveness of criminal governance through strong deterrence and educational rescue functions.
Third, adhere to collaborative governance to fundamentally prevent the risks and harms that assisting crimes may bring. The Supreme People's Procuratorate plans to strengthen the cooperation of the 'four major prosecutions', and has developed and issued a working plan for comprehensively fulfilling prosecutorial functions to promote network governance, establishing a relay and tiered governance model to enhance the effectiveness of network prosecution. Prosecutorial organs should strengthen the reverse connection of criminal enforcement, making relative non-prosecution decisions for those with minor criminal circumstances, and those needing administrative penalties should be legally transferred for administrative punishment. Correctly apply relevant special procedures of the Criminal Procedure Law to minors suspected of assisting crimes, conditionally exempting them from prosecution, while simultaneously carrying out precise education and assistance to help minors involved in crimes reintegrate into society. Focus on issues related to the management of bank cards and phone cards, and actively and steadily carry out public interest litigation prosecution work. Based on prosecutorial case handling, focus on the social governance loopholes and shortcomings reflected behind the cases, issuing suggestions for social governance, and enhancing governance in collaboration with relevant departments. By developing and promoting a legal supervision model based on big data with significant oversight effects, fully leveraging the value of prosecutorial data, promote the path of 'individual case handling - similar case supervision - promoting governance', thereby reducing the recurrence of assisting and concealing illegal crime cases from the source.
Fourth, adhere to 'teaching according to materials' to ensure effective legal publicity. The Supreme People's Procuratorate has released multiple typical cases of assisting and concealing illegal crimes, published case analysis reports, and conducted concentrated publicity. Various regions are conducting targeted legal education and publicity for high-risk groups in 'two-card' cases and specific industry personnel, shifting from 'blanket coverage' to 'precision drip irrigation'. For minors and students, 'anti-fraud into schools' activities will be carried out, while for the elderly, 'anti-fraud into communities and nursing homes' activities will be emphasized. Through legal education and case explanations, increase awareness of network security and enhance the ability to prevent network crimes, collaborating with schools and communities to build a strong anti-fraud defense line.
The procuratorial organs will take the issuance of this 'Opinions' as an opportunity to further enhance their prosecutorial functions, insisting on advancing 'punishment, prevention, and governance' in an integrated manner, lawfully cracking down on and governing assisting crimes, and actively promoting network governance in collaboration with all sectors of society to jointly build a clean cyberspace.
Q: Currently, cases of assisting crimes remain at a high level; how will the people's courts promote the effective governance of assisting crimes? For the general public, how can they avoid becoming 'tools' for telecom fraud and other criminals?
A: The people's courts will continue to adhere to the combination of punishment and prevention, focusing on source governance and comprehensive governance, and regard the legal crackdown on assisting crimes as an important measure to sever the chain of telecom network fraud and eliminate the soil for crimes. 'Department collaboration and joint management will show real results.' The people's courts will continue to work with public security and procuratorial organs to ensure the implementation of the 'Opinions', putting the concept of 'grasping the front end and treating the unwell' into practice, while actively strengthening departmental collaboration. When systemic risks are discovered among financial, telecom, internet companies, and relevant regulatory departments and industry organizations during case handling, timely judicial recommendations will be issued, and relevant departments will strengthen supervision to preemptively 'raise red flags', creating a 'net of interception', transforming 'mending the sheepfold after losing the sheep' into 'taking precautions before the rain', balancing both preventive and punitive measures to jointly promote comprehensive governance of assisting crimes.
We have found in case handling that many individuals involved in crimes related to assisting are often induced to become 'tools' for others due to weak legal awareness, greed for small profits, and a sense of luck. This indicates that effective governance of assisting crimes still requires more targeted legal education and publicity. The people's courts will further innovate publicity methods and means, conducting more targeted and distinctive public education activities based on the characteristics of assisting crimes, through public trials and the release of typical cases, to educate everyone on the law and encourage them to abide by it. We must warn the public that 'the risks of lending out identification and cards are unpredictable.' Personal information closely related to our identity, such as ID cards, phone cards, bank cards, and internet accounts, must not be rented, sold, lent, or involved in '刷单' (order brushing) or '跑分' (money laundering) activities. If exploited by criminals, one will become an accomplice, harming others and oneself, regretting it too late.