Joint Discipline Measures for Telecommunications Network Fraud and Related Violations and Crimes

Promulgation Date: 2024-11-26
Title: Joint Discipline Measures for Telecommunications Network Fraud and Related Violations and Crimes
Document Number:
Expiration date: 
Promulgating Entities: Ministry of Public Security, National Development and Reform Commission, Ministry of Industry and Information Technology, etc.
Commentary on earlier draft:

Forced Offline: proposed penalties under the anti-fraud law

In the name of preventing and deterring fraud, China’s Law on Telecommunication Fraud authorizes severe limits on access to communications and financial services- even for those who haven’t been convicted of fraud or any crime.

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 telecommunications network fraud, or other crimes related to telecommunications fraud such as assisting information network crimes, obstructing credit card management, violating citizens' personal information, hiding or concealing criminal proceeds and the fruits thereof, organizing others to illegally cross state (regional) borders, or illegally crossing state (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 out three or more telephone cards, Internet of Things [IoT] cards, landlines, telecommunications lines, SMS ports, bank accounts, payment accounts, digital RMB wallets, or internet accounts; or providing real name verification assistance for three or more of the cards or accounts described above;

2. Illegally buying, selling, or lending out telephone cards,IoT cards, landlines, telecommunications lines, test messaging terminals, bank accounts, payment accounts, digital RMB wallets, or internet accounts three or more times; or providing real name verification assistance for the cards or accounts described above three or more times;

3. Illegally buying, selling, renting, or lending out telephone cards, IoT cards, landlines, telecommunication lines, SMS ports, bank accounts, payment accounts, digital RMB wallets, internet accounts, and so forth, 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 set up telephone cards, IoT cards, landlines, telecommunication lines, SMS ports, bank accounts, d, payment accounts, digital RMB wallets, internet accounts, and so forth;

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’ directly responsible managers and other directly responsible personnel.

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

Article 6: Banking industry financial institutions and non-bank payment systems shall implement the following financial discipline measures against discipline targets:

(1) Restricting the off-counter cash withdrawal operations for bank accounts and digital RMB wallets under the name of the disciplinary target, except for funds for basic living safeguards provided for in existing agreements, such as for tax withholding and payment, social security, water, electricity, and gas fees;

(2) Stopping all operations of payment accounts in the discipline target’s name, except for the transfer of account balances to bank accounts under the same name;

(3) Suspending the opening of new payment accounts and real-name digital RMB wallets for the discipline targets, and newly opened bank accounts should comply with the requirements of item (1) above.

Article 7: Telecommunications industry operators and internet service providers shall implement the following telecommunications network discipline measures against discipline targets:

(1) Restrict functions and operations such as transfers for telephone cards, IoT cards, landlines, telecommunications lines, and SMS ports, in the discipline target's name;

(2) Restrict the functions and operations of internet accounts registered to the discipline targets' phone number that have fraud risk;

(3) New telephone cards, IoT cards, landlines, telecommunications lines, SMS ports, and internet accounts with fraud risks, etc. must not be opened for discipline targets, and discipline targets must not be provided with website or program distribution and market services;

The telecommunications services and internet applications above, which involve discipline targets, shall have a higher fraud or security risk, with the specific scope of punishment to be determined by the public security organs in collaboration with the industry regulatory departments. During the discipline period, within 10 working days after receiving notice of the discipline from the public security organs, the discipline targets may apply to the public security organs to retain one telephone card that is not involved in the case.

Article 8: Credit discipline measures shall be implemented through the following means:

(1) Enter discipline targets into the "Telecommunications Network Fraud" list of seriously untrustworthy entities, to be shared with the National Credit Information Sharing Platform, and display information on seriously untrustworthy entities on the "Credit China" website;

(2) Include information on discipline targets in the Basic Financial Credit Information Databases.

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;

(2) The discipline measures in articles 6, 7, and 8(2) 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;

Article 10: For discipline subjects who have been sentenced to a prison term or short term imprisonment, the discipline period is to be calculated from the date on which enforcement of the sentence is completed; the discipline measures of course are effective during the enforcement of the imprisonment. For discipline targets who are sentenced to controlled release or who are given a suspended sentence, the discipline period is to be calculated from the date on which the judgment took effect. Where there was a determination by public security organs at the district-city level, the discipline period is calculated from the date of the designation. 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, and the discipline targets are automatically removed from the "Telecommunications Fraud" list of seriously untrustworthy entities.

Article 11: When county-level public security organs handle cases of telecommunication network fraud and related crimes or violations, they shall promptly learn about the suspects’ or defendants' situation in terms of transfer for prosecution and judgment, 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's review and determination, it is to issue a joint disciplinary action target report form, 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.

Article 12: The People's Bank of China Credit Reporting Information Center, telecommunications industry proprietors, banking industry financial institutions, non-bank payment establishments, and internet service providers shall implement discipline measures and give feedback on their outcome within 10 working days of receiving information from the public security organs on discipline targets.

Article 13: Before the relevant departments implement discipline measures, the public security organ that designated a discipline target shall notify the discipline target in writing, either in person or through the mail, of content such as the matter on which the discipline is based, the discipline period, the discipline measures, their right to appeal in accordance with law, and the channels for appeals.

Article 14: Where discipline targets have objections to the designation, or where related discipline measures were not lifted when due, an appeal may be submitted to the public security organs that made the designation in person, by phone, or in writing. 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. The Ministry of Public Security is to transfer information related to the releasingof joint discipline targets to the National Reform and Development Commission, the Ministry of Industry and Information Technology, and the People's Bank of China.

Where the incorrect designation of a discipline target causes harm to that person, the relevant accountability shall be pursued in accordance with law.

Article 16: The People's Bank of China Credit Reporting Information Center, telecommunications industry proprietors, banking industry financial institutions, non-bank payment establishments, and internet service providers shall lift discipline measures and give feedback on the outcome within 10 working days of receiving information from the public security organs on lifting discipline measures.

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. "Or more" [or above] as used in these measures includes that level or number.

Article 18: These measures take effect on December 1, 2024. These Measures do not apply to the conduct listed in article 3 of these Measures carried out before the "PRC Law on Countering Telecommunications Network Fraud" was implemented.

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