Joint Discipline Measures for Telecommunications Network Fraud and Related Crimes and Violations (Draft for Solicitation of Comments)

[Source]https://www.mps.gov.cn/n2254536/n4904355/c9288546/content.html

Article 1: These Measures are formulated on the basis of the PRC Law on Countering Telecommunications Network Fraud and other laws and regulations so as to combat and govern telecommunication network fraud and other related crimes and violations, and to establish joint discipline systems.

Article 2: Joint discipline systems shall follow the principles of being designated in accordance with law, having discipline that corresponds to the offense, and being dynamically managed.

Article 3: The "discipline targets" provided for in these Measures include:

(1) Persons who have received criminal punishments for committing telecommunication network fraud or carrying out activities that assist in information network crimes related to telecommunication network fraud, obstructing credit card management, infringing citizens' personal information, concealing and hiding criminal proceeds or the fruits of those proceeds, or organizing others to illegally cross national (regional) borders, or illegally crossing the national (regional) borders;

(2) Units, individuals, and related organizations that have been designated by public security organs at the districted-city level or above as having any of the following conduct:

1. Illegally buying, selling, renting, or lending three or more telephone cards, IoT cards, landlines, telecommunication lines, SMS ports, bank accounts, payment accounts, digital RMB wallets, internet accounts, domain names, or IP addresses, or providing real name verification assistance for three or more of the above cards or accounts;

2. Illegally buying, selling, renting, or lending telephone cards, IoT cards, landlines, telecommunication lines, SMS ports, bank accounts, payment accounts, digital RMB wallets, internet accounts, domain names, or IP addresses three or more times, or providing real name verification assistance for the above cards or accounts three or more times;

3. Illegally buying, selling, renting, or lending telephone cards, IoT cards, landlines, telecommunication lines, SMS ports, bank accounts, payment accounts, digital RMB wallets, internet accounts, domain names, or IP addresses to three or more people, or providing real name verification assistance for the above cards or accounts to 3 or more people;

4. Posing as other people or faking an agency relationship to Illegally buy, sell, rent, or lend telephone cards, IoT cards, landlines, telecommunication lines, SMS ports, bank accounts, digital RMB wallets, payment accounts, internet accounts, domain names, or IP addresses;

In any of the situations above, where the numeric standard isn’t reached but it caused a larger impact, and discipline is truly necessary, they may be listed as the targets for joint discipline upon the review and designation of a public security organ at the provincial level or above.

Article 4: Where the targets of joint disciplinary action are units, discipline may also be concurrently carried out for the units’ legal representatives, primary responsible persons, directly responsible persons, and actual controllers.

Article 5: Discipline measures include financial discipline, telecommunications discipline, and credit discipline.

Article 6: The People's Bank of China is to organize banking industry financial institutions and non-bank payment systems to implement the following financial discipline measures against discipline targets:

(1) Suspending the off-counter cash withdrawal operations for bank accounts and digital RMB wallets under the name of the disciplinary target, except for payments to state administrative departments and public utility departments provided for in existing agreements, such as for taxes, social security, water, electricity, and gas fees;

(2) Suspending all operations of payment accounts in the discipline target’s name, except for the transfer or withdrawal of the accounts’ balance;

(3) During the disciplinary period, new payment accounts and digital RMB wallets must not be opened for the discipline target, and newly opened bank accounts should comply with the requirements of the first paragraph:

Article 7: In accordance with their respective scope of responsibility, the Ministry of Industry and Information Technology and the Ministry of Public Security are to organize telecommunications operators and internet service providers to implement the following network discipline measures against discipline targets:

(1) Shut down communications operations in the discipline targets’ name, such as telephone cards, IoT cards, landlines, telecommunications lines, SMS ports, domain names, and IP addresses, but not including communication operations involved in production, operations, life, or health; leaving them with only a single telephone card that is not related to the case;

(2) Simultaneously shut down all social media or traffic drawing internet accounts that are registered to the telephone cards (but leaving a single telephone card that is not related to the case) and have a risk of being involved in fraud; and new internet accounts with fraud risk must not be opened for them;

(3) New telephone cards, IoT cards, landlines, telecommunications lines, SMS ports, domain names, and IP addresses must not be opened for discipline targets, and discipline targets must not be provided with website or program distribution and market services.

Article 8: The Ministry of Public Security is to share relevant discipline targets on the national credit information sharing platform and publicly display the information on seriously untrustworthy entities via “credit China”.

The Ministry of Public Security is to provide the People's Bank of China’s credit reporting center with relevant information on discipline targets, and the People's Bank of China’s credit reporting center is to enter them in the Basic Financial Credit Information Databases in accordance with state provisions.

Article 9: Graded discipline is to be carried out for discipline subjects:

(1) The discipline measures provided in articles 6 and 7 apply to those who were criminally pursued because they committed telecommunication network fraud or related crimes, and the discipline period is 3 years; for those sentenced to 3 or more years imprisonment, the discipline measures in article 8 may also be applied;

(2) The discipline measures in articles 6 and 7 of these Measures are to be applied for discipline targets that have been designated by public security organs at the districted-city level and above, and the discipline period is 2 years; for those units, individuals, and related organizations that have bought, sold, rented, or lent bank accounts, payment accounts, or digital RMB wallets, the discipline measures in paragraph 2 of article 8 of these Measures may also be applied.

Article 10: For discipline subjects who have been sentenced to imprisonment, the discipline period is to be calculated from the date on which enforcement of the imprisonment is completed; the discipline measures of course are effective during the enforcement of the imprisonment. For discipline targets who are sentenced to non-custodial criminal punishments or who are given a suspended sentence, the discipline period is to be calculated from the date on which the judgment took effect.

The discipline period for other discipline targets is to be calculated from the date on which they were designated as discipline targets.

Where discipline targets are disciplined multiple times during the discipline period, the discipline period is to be calculated cumulatively, but the consecutive enforcement periods must not exceed 5 years.

Discipline measures are automatically lifted at the expiration of the discipline period.

Article 11: When county-level public security organs handle cases of telecommunication network fraud and related crimes of violations, they shall promptly learn about the suspects’ judgment situation, and where the requirements of article 3 of these Measures are met, promptly report to the public security organ at the districted-city level or higher for review.

After a public security organ at the districted-city level conducts a review and confirmation, it is to issue a joint disciplinary action target report reform, indicating information such as the discipline measures and periods.

The Ministry of Public Security is to send the joint discipline target forms issued by the local public security organs to the National Development and Reform Commission, the Ministry of Industry and Information Technology, and the People's Bank of China through the chief-to-chief method.

Article 12: Through means such as in-person meetings or mail, the public security organ that issued a discipline target designation shall notify the discipline target in writing of content such as the matter on which the discipline is based, the discipline period, the discipline measures, and their right to appeal in accordance with law.

Article 13: The Ministry of Industry and Information Technology and the People's Bank of China are to implement discipline measures in accordance with the information on the discipline targets designation, and promptly give feedback on the outcomes.

Article 14: Where there are objections to the designation of discipline targets, or where related discipline measures were not lifted when due, an appeal may be submitted to the public security organs that made the designation.

After the public security organs receive an appeal, within 3 working days they shall inform the complainant one time in writing of the materials they need to provide, complete review efforts within 15 working days of receiving the materials, and give the complainant written feedback on the outcome of the review, and explain the reasoning where not the discipline measures.

Article 15: Where through review it is found that the original designation for discipline was in error, then after a districted-city level public security organs’ review and evaluation of the designation, it is to promptly issue a form for removal as a joint discipline target, and the public security organs are to transfer the form to the relevant departments.

After the Ministry of Industry and Information Technology and the People's Bank of China receive a form for the removal as a joint discipline target, they shall organize the relevant bodies to lift the discipline measures within 10 working days.

Article 16: After the credit discipline period expires or after discipline targets’ credit discipline is lifted upon review, the National development and Reform Commission and People's Bank of China credit reporting center shall promptly follow relevant provisions to remove the discipline targets relevant information from the national credit information sharing platform and stop sharing the information on the Basic Financial Credit Information Databases

Article 17: The provisions of these measures related to disctricted-city level public security organs are to apply to the district and county level public security organs in directly governed municipalities.

“Above” as used in these Measures includes the level or number itself.

Article 18: Where normative documents previously released by the Supreme People's Court differ from these Provisions, these Opinions are controlling.

Article 19: These Measures are to take effect from their date of publication.