When you see. Low investment, high return investment.
Will it be ready to move.
Be careful! Once the heart is tickled.
You've fallen into the trap of **.
A set of cartoons exposing illegal fundraising**
Recently. Cases of illegal fundraising are high and frequent.
And the funds involved are huge.
Seriously undermine the order of financial management.
Infringing on the safety of people's property.
The harm to society is extremely great.
Let's find out
Several common legal issues of illegal fundraising
Increase the number of criminal activities against illegal fundraising
Awareness and preparedness
What is the definition of illegal fundraising? What are the characteristics of illegal fundraising?
Illegal fundraising refers to the act of absorbing funds from unspecified targets without the permission of the financial management department in accordance with the law or in violation of national financial management regulations, by promising to repay principal and interest or giving other investment returns.
The "four sexes" characteristics of illegal fundraising:
Unlawfulness, that is, "absorbing funds without the approval of the relevant departments in accordance with the law or in the form of legal operation";
Publicity, that is, "through the Internet, ** promotion meetings, leaflets, mobile phone text messages and other channels to the public";
Temptation, that is, "undertaking to repay principal and interest or pay returns in the form of money, kind, equity, etc. within a certain period of time";
Sociality, that is, "to absorb funds from the public, that is, to unspecified objects in society".
[Legal Index].Article 2 of the Regulations on the Prevention and Disposal of Illegal Fundraising (Order No. 737 of the People's Republic of China).
Article 1 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Specific Application of Law in the Trial of Criminal Cases of Illegal Fundraising (2022 Amendment).
What are the entities involved in illegal fundraising and their respective responsibilities?
"Illegal fundraiser" refers to the units and individuals that initiate, lead or organize the implementation of illegal fundraising; An illegal fundraising facilitator is a unit or individual that provides assistance to the person who knows that it is illegal fundraising and obtains economic benefits.
Illegal fundraisers and fundraising facilitators shall return the fundraising funds to the fundraising participants.
For illegal fundraisers, the lead department for the disposal of illegal fundraising shall impose a fine of not less than 20% but not more than 1 time of the amount of funds raised. Where the illegal fundraiser is a unit, it may also be ordered to suspend production and business according to the severity of the circumstances, and the relevant authorities shall revoke the permit, business license or registration certificate in accordance with law; Their legally-designated representative or principle responsible person, directly responsible managers, and other directly responsible personnel are to be given warnings and fined between 500,000 and 5,000,000 RMB. where a crime is constituted, criminal responsibility is pursued in accordance with law.
For the illegal fundraising facilitators, the lead department for the disposal of illegal fundraising shall give a warning and impose a fine of not less than 1 time but not more than 3 times the illegal gains; where a crime is constituted, criminal responsibility is pursued in accordance with law.
[Legal Index].Articles 3, 25, 30 and 31 of the Regulations on the Prevention and Handling of Illegal Fundraising (Order No. 737 of the People's Republic of China).
What kind of offences may be constituted by illegal fundraising?
According to the provisions of China's current criminal law, illegal fundraising may constitute the crime of illegally absorbing public deposits and the crime of fundraising fraud.
The crime of illegally absorbing deposits from the public refers to the act of illegally absorbing deposits from the public or absorbing deposits from the public in disguised form in violation of national financial management laws and regulations, thereby disrupting the financial order.
The crime of fund-raising fraud refers to the use of fraudulent methods to illegally raise funds for the purpose of illegal possession, in violation of the provisions of relevant financial laws and regulations, disrupting the normal financial order of the state, and infringing on the ownership of public and private property, and the amount is relatively large.
[Legal Index].Articles 176 and 192 of the Criminal Law of the People's Republic of China.
How to define the "purpose of illegal possession" of the crime of fundraising fraud?
In any of the following circumstances, it may be found to be "for the purpose of illegal possession":
After the fundraising is not used for production and business activities, or the use for production and business activities is obviously disproportionate to the scale of the funds raised, resulting in the fundraising funds cannot be returned;
wantonly squandering the fund-raising funds, so that the fund-raising funds cannot be returned;
fleeing with the raised funds;
using the raised funds for illegal or criminal activities;
Evading or transferring funds, concealing assets, or evading the return of funds;
concealing or destroying accounts, or engaging in fake bankruptcy or bankruptcy, to evade the return of funds;
refusing to explain the whereabouts of the funds and evading the return of funds;
Other circumstances where the purpose of illegal possession may be determined.
Where fraudulent methods are used to carry out the acts listed in [Question 5] for the purpose of illegal possession, it is to be convicted and punished as the crime of fundraising fraud.
[Legal Index].Article 7 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Specific Application of Law in the Trial of Criminal Cases of Illegal Fundraising (Revised in 2022).
What are the sentencing standards for the crimes of illegally absorbing public deposits and fund-raising fraud?
Those who commit the crime of illegally absorbing public deposits are to be sentenced to up to three years imprisonment or short-term detention and/or a fine; where the amount is huge or there are other serious circumstances, a sentence of between 3 and 10 years imprisonment and a concurrent fine is to be given; where the amount is especially huge or there are other especially serious circumstances, a sentence of 10 or more years imprisonment and a concurrent fine is to be given.
where the crime of fundraising fraud is committed, and the amount is relatively large, a sentence of between three and seven years imprisonment and a concurrent fine is to be given; where the amount is huge or there are other serious circumstances, a sentence of 7 or more years imprisonment or indefinite imprisonment is to be given, and a concurrent fine or confiscation of property.
[Legal Index].Articles 176 and 192 of the Criminal Law of the People's Republic of China.
What are the main manifestations of illegal fundraising activities?
In judicial practice, illegal fundraising activities take various forms, which are summarized as follows:
the establishment of Internet enterprises, investment and investment consulting enterprises, various trading venues or platforms, professional farmer cooperatives, mutual fund organizations and other organizations to absorb funds;
Issuing or transferring equity and creditor's rights, raising funds, selling insurance products, or engaging in various types of asset management, virtual currency, financial leasing business, etc.;
In commercial activities such as the sale of goods, the provision of services, and investment projects, the absorption of funds in the form of promises to pay returns such as money, equity, and in-kind returns;
Violating laws, administrative regulations, or relevant state provisions, publicly disseminating information on the absorption of funds through mass media, instant messaging tools, or other means;
Other suspected illegal fundraising.
[Legal Index].Article 19 of the Regulations on the Prevention and Disposal of Illegal Fundraising (Order No. 737 of the People's Republic of China).
What are the specific acts of illegally absorbing deposits from the public?
Those who carry out any of the following acts and meet the requirements of the "four sexes" characteristics of illegal fundraising shall be punished as the crime of illegally absorbing public deposits:
Illegally absorbing funds by means such as return to principal sales, after-sales leases, agreed repurchases, or sales of real estate shares, without having the true content of real estate sales or without the main purpose of real estate sales;
illegally absorbing funds by transferring forest rights and managing them on behalf of others;
illegally absorbing funds by means such as substitution planting (breeding), renting planting (breeding), joint planting (breeding), etc.;
does not have the true content of selling goods or providing services, or does not have the main purpose of selling goods or providing services, illegally absorbing funds by means such as commodity repurchase or consignment sales;
does not have the true content of the issuance of ** or bonds, and illegally absorbs funds by means of false transfer of equity, sale of fictitious bonds, etc.;
does not have the true content of the fundraising, and illegally absorbs funds by means of pretending to be overseas**, selling fictitious **, etc.;
Illegally absorbing funds by impersonating insurance companies, forging insurance documents, etc., without the true content of selling insurance;
illegally absorbing funds through online lending, investment in shares, virtual currency transactions, etc.;
illegally absorbing funds by means such as entrusted wealth management or financial leasing;
illegally absorbing funds by providing "pension services", investing in "pension projects", selling "elderly property", etc.;
using non-governmental organizations such as "associations" and "societies" to illegally absorb funds;
Other acts of illegally absorbing funds.
[Legal Index].Article 2 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Specific Application of Law in the Trial of Criminal Cases of Illegal Fundraising (Revised in 2022).
The specific modus operandi of illegal fund-raising activities.
Promise high returns. Illegal fundraisers promise high returns, creating the myth of "getting rich overnight". In order to deceive more people to participate in fundraising, criminals often honor the promised principal and interest on time and in full in the early stage of fundraising, and after the fundraising reaches a certain scale, they may break the capital chain or abscond with the money due to poor management, and investors will suffer economic losses.
Make up fake projects. Most of the illegal fundraisers invent various false projects to deceive the public by registering legitimate companies or enterprises, in the name of responding to national policies, innovation and entrepreneurship, etc., with so-called new financial management methods such as private placement, crowdfunding, and factoring.
False propaganda to build momentum. Illegal fundraisers are good at publicizing and building momentum, holding various product promotion meetings, annual meetings, etc., hiring celebrities to stand on platforms, publishing advertisements on radio and television and Internet platforms, publishing exclusive interview articles in newspapers and periodicals, organizing the distribution of leaflets, and making social donations.
Use family affection to deceive. In order to increase their performance and seek illegal benefits, some illegal fundraisers will adopt methods similar to pyramid schemes, and do not hesitate to take advantage of family and geographical ties to fabricate lies that they have obtained high returns, and attract relatives, friends, classmates or neighbors to join, so that the number of participants will spread rapidly and the scale of fundraising will continue to expand.
The basic steps of illegal fund-raising activities.
Step 1: Draw the pie. Illegal fundraisers will concoct projects that are as "high" as possible in order to absorb the funds. It is common to use new technologies, new revolutions, new policies, blockchain, virtual currencies, etc. as a guise to depict a blueprint for expected rewards, giving potential investors the illusion that the opportunity cannot be missed. Even if there is an illegal absorption of public deposits in real business, it often exaggerates the profitability and repayment ability of the project, and conceals it knowing that there is a huge financial risk.
Step 2: Build momentum. Illegal fundraisers are often adept at using resources to make a big splash. Common such as holding product promotion meetings, observation meetings, experience day activities, knowledge lectures, etc., organizing tours, inspections, etc., giving away daily necessities, souvenirs, phone bills, etc.; Display all kinds of real or fake award certificates, ** approval documents, "technical certifications", etc.; Announce the inspection of film and television materials by leaders, and take photos of company leaders and celebrities; The event was held in the conference center and auditorium, which was a big scene and a high-standard campaign.
Step 3: Absorb gold. The ultimate goal of illegal fundraisers is to extract the public's investment money. Illegal fundraisers pay the proceeds to the fundraising participants on time through rebates and dividends in the early stage, inducing the fundraising participants to believe that the funds are safe and the expected returns can be realized, and then invest more money, and even mobilize relatives and friends to join, making the amount of funds raised bigger and bigger.
Step 4: Run. Illegal fundraisers often run away after a period of "gold absorption", or the capital chain is broken due to poor management, or because the original "Ponzi **" people go to the empty building, and the project as a whole "bursts", and it is difficult to pay the principal and expected income of the fundraising participants. Most of the fundraising participants will suffer heavy economic losses, or even lose all their money, causing serious social harm.
Advice to potential investors and investors.
For the majority of investors, it is necessary to enhance their awareness of the rule of law and risk, and they must know that investment is risky and financial management needs to be cautious. Specifically:
We should strengthen the learning of financial knowledge such as trading and trading, build our own trading system and financial management ideas, and be cautious about all kinds of investment publicity.
In addition to basic financial knowledge, students should also learn relevant legal knowledge to improve their ability to identify and prevent illegal fundraising activities.
Investors who have investment consulting needs should look for formal investment consulting institutions, consult investment consultants with complete qualifications, and strengthen the specific investigation of the proposed investment projects, so as to do enough "due diligence" homework on investment.
Except as otherwise provided by laws, administrative regulations and the state, the name and business scope of enterprises and individual industrial and commercial households shall not contain words or content such as "finance", "exchange", "trading center", "wealth management", "wealth management" and "equity crowdfunding". Pay attention to the identification of market entities with the above characteristics.
For illegal fundraising and other illegal and criminal activities, report to the relevant departments in a timely manner to safeguard their legitimate rights and interests and help purify the market environment.
If an investment has already been made and the project "explodes", attention should be paid to collecting all investment evidence, detailing the specific investment process, making a detailed written report material, and submitting all the evidence to the case-handling organ, and cooperating with the case-handling organ's investigation. It should be believed that the judicial organs and relevant departments will do their best to recover the stolen goods and recover the losses, make every effort to safeguard the rights and interests of the public, and handle the case fairly and impartially.
*: Judicial Case Research Institute of the Supreme People's Court Shanghai Minhang Court Cartoon Production: Fujian Legal News Editor-in-charge: Huang Huier.
Review: Fang Cong Gao Qi.
Delivered an important speech at the Third Plenary Session of the 20th ** Commission for Discipline Inspection
Today's headlines are left for them: the People's Police
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