China releases new measures to crack down on telecom and internet fraud and related crimes

China’s Ministry of Public Security (MPS), together with three other government agencies, announced on Tuesday the release of the “joint punishment measures for telecom and internet fraud and related crimes” to support the implementation of the Anti-Telecom and Online Fraud Law.

According to the MPS, telecom and internet fraud cases have become the fastest-growing type of criminal crimes. Apart from the evolving scam tactics, enhanced technological countermeasures, and the relocation of criminal dens abroad, criminal groups have continuously acquired tools like phone cards, Internet of Things (IoT) cards, SMS gateways, bank accounts, and payment accounts under false identities through purchase, rental, or borrowing, significantly contributing to the prevalence of such crimes. 

The new measures will take effect on December 1, 2024, consisting of 18 articles covering six aspects, namely punishment principles, punishment targets, punishment measures, punishment categories, punishment procedures, as well as appeal and verification. 

The punishment measures were formed in accordance with China’s Anti-Telecom and Online Fraud Law and other relevant laws and regulations and the punishment adheres to legal principles, proportionality in punishment, and dynamic management, according to the regulations. 

The Anti-Telecom and Online Fraud Law took effect on December 1, 2022.

The punishment measures also define the punishment targets and the criteria for their identification. Individuals who have been subjected to criminal punishment for engaging in telecom and internet fraud activities, assisting in cybercrimes related to telecom network fraud, obstructing credit card management, infringing on citizens' personal information, concealing or disguising criminal proceeds or gains, as well as organizing or facilitating others in illegal border crossing activities. 

Individuals who have been identified by public security departments at city levels or above as illegally buying, selling, renting, lending three or more phone cards, IoT cards, fixed phone accounts, telecommunication lines, SMS ports, bank accounts, payment accounts, digital yuan wallets and internet accounts three times to more than three objects. 

Besides, units and individuals who open accounts by impersonating others or fabricating agency relationships are also specified as the punishment targets in the punishment measures. 

The punishment measures propose that individuals held accountable for criminal responsibility for telecom and internet fraud and related crimes should be included in the “list of seriously dishonest subjects” with whose information shared on a credit sharing platform for publicity.

Concrete punishments include restricting bank accounts and digital yuan wallet functions and suspending eligibility to open new accounts.

Meanwhile, in order to fully reflect the appropriateness of the punishment, the measures ensure that the individuals’ basic living needs such as payments of their basic daily expenditures are also protected while they are subjected to the punishment. 

The police authorities remind the public not to illegally buy, sell, rent, lend, impersonate others, or fabricate agent relationships to open phone cards, IoT cards, telecom lines, SMS ports, bank accounts, payment accounts, or internet accounts, and advise against participating in illegal activities such as helping fraudsters set up call forwarding devices, promote scams, or transfer fraud-related funds, in order to prevent being exploited by criminals for telecom and internet fraud activities.