Introduction
Xiaoxia (a pseudonym) is an ordinary office worker. An "intermediary" in a part-time job group introduced him to an "easy gig": using several bank cards in his own name and his family members' names to receive money for others, then transferring the funds out according to instructions once they arrived, taking a 50-yuan "service fee" for every 10,000 yuan. He did this for three months and earned 12,000 yuan.
On the other side, Mr. Wu, who ran an "aggregated payment" business, built a system at his company that pooled dozens of bank cards purchased from others and more than a dozen payment accounts into a fund pool, and externally offered "collection of payment for goods" and "instant same-day payment on behalf" services, charging six-thousandths of the transaction volume. Over two years, the business settled more than 900 million yuan.
Last year, these two groups of people were apprehended one after the other. Their family members asked me the same question:
"Aren't they both just helping people transfer money? Why is Xiaoxia charged with the crime of assisting information network criminal activities, while Mr. Wu is charged with illegal business operation? I heard illegal business operation carries a maximum sentence of fifteen years?"
I said, you have hit the nail on the head.
The same pair of hands transferring money: some are a "pipeline" for someone else's crime, while others have opened an unlicensed "underground bank" of their own—the former is an accomplice, the latter is an operator. The charges differ, the sentences differ by several times, and the defense strategies are poles apart.
This article draws that line clearly for everyone who "helps others transfer money" and everyone who "makes money by transferring money."
The cases are adapted from public court judgments and public reports, and the names of the individuals have been changed.
01 First, get clear: which line did your conduct actually cross?
The act of transferring and passing funds through accounts corresponds to three possible lines under criminal law. I will explain them in order from lowest to highest risk.
The first line: the crime of assisting information network criminal activities
Article 287-2 of the Criminal Law provides that where a person, knowing that another person is using an information network to commit a crime, provides payment and settlement assistance to that person, and the circumstances are serious, this constitutes the crime of assisting criminal activities on information networks, punishable by up to three years.
The typical profile is Xiaoxia: he provides bank cards, receives and transfers funds according to instructions, and earns a fixed percentage as compensation for his labor.
The activities he serves are upstream criminal activities, such as telecommunications fraud and online gambling; he is merely a "tool person" at the end of the criminal chain.
The second line: the crime of concealing or disguising criminal proceeds
Article 312 of the Criminal Law provides that where a person, knowing that property is criminal proceeds or the proceeds thereof, assists in transferring such property, this constitutes the crime of concealing or disguising criminal proceeds or the proceeds of criminal proceeds; where the circumstances are serious, the person may be sentenced to fixed-term imprisonment of not less than three years but not more than seven years.
An important dividing line between this crime and the crime of assisting criminal activities on information networks lies inthe timing of the conduct。
After the upstream crime has been completed, if you then assist in disposing of the illicit funds, for example by collecting illicit funds, exchanging them for USDT, splitting and diverting them, or laundering them, this may fall within the scope of the crime of concealing or disguising criminal proceeds.
In cases involving assisting others with transfers, if what is received is telecommunications fraud proceeds that have already been obtained and you then assist in transferring them, the case-handling authorities will often characterize the conduct as the crime of concealing or disguising criminal proceeds.
The third line: the crime of illegal business operations
Article 225, item (3) of the Criminal Law provides that where a person, without approval, illegally engages in fund payment and settlement business, and the circumstances are serious, the person shall be sentenced to fixed-term imprisonment of not more than five years; where the circumstances are especially serious, the person shall be sentenced to fixed-term imprisonment of not less than five years.
What this line targets is not simply "helping others transfer money," but rather:
Operating a payment business without a license.
Typical cases include operators of fourth-party payment platforms, illegal payment-settlement schemes, underground banks and similar operations.
The key characterizing term is:
"operating."
That is, providing funds-transfer services for profit, to unspecified persons, on a continuous basis, gradually forming a business and turning it into a commercial enterprise.
How should the differences among the three be understood?
By way of analogy:
In the case of the crime of assisting information network criminal activities or the crime of concealing or disguising criminal proceeds, you are a "water pipe" along another person's path of crime.
In the case of illegal business operations, you have opened your own "water utility," except that you have no license.
A "water pipe" is handled as an act of assistance, whereas a "water utility" is targeted as unlicensed business operations.
The Interpretation of the Supreme People's Court and the Supreme People's Procuratorate on Several Issues Concerning the Application of Law in the Handling of Criminal Cases of Illegally Engaging in the Payment and Settlement Business of Funds and Illegally Trading in Foreign Exchange (Fa Shi [2019] No. 1) expressly provides:
Using acceptance terminals or online payment interfaces and other methods to pay monetary funds to a designated payee through illegal means such as fictitious transactions, falsely stated prices or transaction refunds, as well as illegally providing others with services to cash out unit bank settlement accounts or to transfer funds from unit bank settlement accounts to individual accounts, and illegally providing others with check-cashing services, constitute "illegally engaging in the payment and settlement business of funds."
Illegal payment-settlement schemes and fourth-party payment providers are precisely what this definition is designed to cover.
02 How Judicial Practice Determines This
(I) Comparison of Three Characterizations
(II) From "Water Pipe" to "Water Plant": Four Features for Finding Illegal Business Operations
In practice, when determining whether a funds-transfer activity has "escalated" into the business of payment and settlement, case-handling authorities generally focus on the following four features.
Whether there is a fund pool or account system
Is it an occasional single transaction using one's own card, or the coordinated deployment of dozens or hundreds of bank cards and multiple payment accounts?
Whether there is platform-based operation
Is it sporadic private work taken on through WeChat, or has a system, app, or website been built with complete processes for order intake, order allocation, reconciliation, and settlement?
Whether it is directed at unspecified persons
Is the client base limited to a single fixed 'upstream party,' or does the business openly solicit customers in the market, such that anyone may come to make deposits and withdrawals?
Whether commissions are taken as a percentage of transaction volume and whether the business operates by transferring funds as its trade
Is the profit an occasional thank-you fee, or has fund settlement already been made the main business, with continuous profit-taking at a fixed fee rate?
The more of these four characteristics are present, the more readily the conduct is likely to be characterized as illegal business operations.
Mr. Wu's case exhibits all four:
there is a system, there is a fund pool, customers are openly solicited, and a commission of six per thousand is taken.
In the case file, this is no longer a simple matter of 'helping out'; it may instead be characterized as 'engaging in fund payment and settlement business without approval.'
(3) A key defense fact: illegal business operations do not require 'knowledge of the upstream crime'
Many people do not realize:
To establish the crime of assisting information network criminal activities or the crime of concealing or disguising criminal proceeds, the prosecution must prove that the actor possessed the corresponding 'knowledge.'
However, to establish the payment-and-settlement type of illegal business operations, the focus is on proving that the actor:
lacked a license + engaged in payment and settlement on a business basis.
Therefore, whether the funds in the pool constitute illicit proceeds is not the sole prerequisite for the establishment of the crime of illegal business operations.
If illicit proceeds are also present therein, this may further give rise to other criminal issues.
This is also why some fourth-party payment operators' claims that "I did not know who the customer was" or "I did not know the nature of the customer's money" do not automatically negate the crime of illegal business operations.
This is because the core conduct evaluated under this crime is itself the unapproved operation of a funds payment and settlement business.
(IV) Actual Judicial Approach
According to publicly available judicial documents, in cases of illegal foreign exchange trading by underground banks, there are instances in which an intermediary was sentenced to eight years' imprisonment.
The party argued that he was merely an "introducer," but the court, based on characteristics such as his long-term, continuous intermediation and per-transaction commission, determined that he was an organizer of business operations and convicted him as a principal offender in the crime of illegal business operations.
In addition, according to typical cases published by the Supreme People's Court and the Supreme People's Procuratorate and public reports, the builders and operators of illegal payment-settlement platforms and fourth-party payment platforms, as compared with persons at the lower tier who merely provide bank cards, may face different charges in judicial practice.
Within the same funds chain, the legal liability of upper-tier operators and lower-tier card providers may be entirely different.
03 If Already Targeted, Where Is the Room for Defense
First defense point: recharacterizing "operation" as "assistance"
There is a considerable sentencing disparity between the crime of illegal business operations and the crime of assisting information network criminal activities; therefore, for persons characterized as "operators," whether they genuinely possess an operational character is an important point of dispute.
The key lies in determining:
- Is the service provided to a single fixed upstream party rather than to an unspecified public?
- Is there any public solicitation of customers?
- Does the party have independent pricing authority?
- Does the party conduct settlement independently?
- Or does the party operate entirely according to the upstream party's instructions?
- Does the so-called fund pool actually exist?
- Or does the party merely use a few bank cards to receive payments passively?
If the party in question is in fact merely a "large-scale card farmer" with a low degree of organization, no platform and no pricing authority, there is room to argue that the conduct constitutes assisting behavior rather than independent business operation.
Second defense point: reduction of the amount of payment settlement
Judicial Interpretation No. 1 of 2019 defines "serious circumstances" and "especially serious circumstances" by reference to standards such as the amount of illegal business operations and the amount of illegal gains.
Therefore, the calculation of the transaction volume involved in the case is crucial.
Key areas for review:
- Do the transaction records show inflated amounts caused by self-dealing or circular transfers?
- Are normal business operations commingled with the business involved in the case?
- Are there double counts in the matched transfers among multiple accounts?
- After the same funds flow through multiple accounts, are they counted more than once?
In illegal payment-settlement cases, the transaction amounts often reach hundreds of millions of yuan, but there may sometimes be a large volume of circular and duplicated funds.
If the duplicated portions can be excluded, the amount involved in the case and even the sentencing range may change.
Third defense point: a dual defense on the "tool person's" knowledge and the circumstances
For lower-tier card suppliers such as Xiaoxia, two aspects can usually be the focus.
First, whether "knowledge" is established
Some part-time jobs are packaged with phrases such as "boosting transaction records" or "tax-avoidance transfers."
If the person concerned genuinely lacked awareness of the upstream crime, subjective knowledge can be analyzed in light of chat records, remuneration levels, the course of conduct, and other evidence.
Second, whether the threshold of "serious circumstances" is met
It is necessary to further examine whether the payment settlement amount, illegal gains and other factors meet the criminalization threshold.
For cases that have only just met the threshold, it may be possible to seek more lenient treatment by reference to the specific circumstances of the actor.
The 2025 Opinions of the Supreme People's Court, the Supreme People's Procuratorate and the Ministry of Public Security on the handling of criminal cases such as those involving the provision of assistance in information network criminal activities further refined the determination of "serious circumstances" and lenient treatment.
Fourth defense point: principal and accessory offenders and the separation of liability tiers
Platform-related cases often involve multiple persons.
The builders, operators, technical maintenance personnel, customer service personnel and card providers bear different responsibilities, and in principle their criminal liability should also be distinguished by tier.
For example:
- whether the outsourced technical team actually participated in the platform's operations;
- whether the customer service personnel knew the nature of the funds;
- whether there was a meeting of minds between the card providers and the platform to commit the offense;
- what the status and actual role of each person is in the overall business chain.
These factors may all affect the determination of principal offenders, accessories, and the final charge.
In a platform case, all personnel should not simply be held to exactly the same liability.
04 For Practitioners: Three Compliance Recommendations
For Ordinary Individuals: Remember the "Three Don'ts and One Stop"
Do not rent, sell, or lend your bank cards, payment accounts, or mobile phone SIM cards;
Do not take part-time work involving "collecting and making payments on behalf of others to earn commissions";
Do not lend your merchant payment QR code to others for processing transactions.
Once an account is frozen or you receive a bank risk warning, you should immediately stop the relevant operations and proactively verify the matter.
Continuing the relevant conduct may cause the original "possible lack of knowledge" to gradually evolve into an important factor on which judicial authorities rely to determine "actual knowledge."
Bearing criminal risk for a small amount of so-called "hard-earned fee" is clearly not worth the loss.
In the payment business, ask about the license first, then discuss technology
Fund payment and settlement is a business area subject to strict regulation.
Without the requisite licence, however, actually operating payment and settlement business through models such as pooled funds, collection and payment on behalf of others, or aggregated routing may expose a party to relatively high legal risk.
The so-called "fourth-party payment" does not mean that it falls outside regulatory oversight.
There is a clear distinction in legal risk between merely providing technical outsourcing or information matching services and directly handling, pooling or distributing funds.
Once a party actually becomes involved in the pooling and distribution of funds, the nature of its business may change.
Accordingly, before commencing the relevant business, a necessary compliance assessment should first be carried out.
Those already engaged in the relevant business should promptly conduct a health check on the "nature of the funds".
It is necessary to re-examine one's own business:
- Who are the customers?
- Has real-name verification been carried out?
- What is the proportion of funds moving quickly in and out?
- Are there transaction characteristics associated with high risk, such as gambling or fraud?
- Are there abnormal circumstances such as concentrated transactions at night, round-number amounts, or high-frequency offsetting?
Where high-risk characteristics are identified, the relevant business should be promptly discontinued, high-risk customers should be exited, and necessary evidence should be retained, while professionals should be consulted to assess the risks of historical business.
In addition, normal business materials of genuine merchants should be promptly archived.
If the relevant accounts are involved in a case in the future, these materials may become important evidence for distinguishing legitimate business transaction flows from transaction flows connected to the case.
Final Remarks
Money is one thing: handling it once is helping a favor, but handling it ten thousand times may turn into a business.
Criminal law evaluates conduct at different levels differently:
For persons at the end of the chain who provide bank cards or payment accounts and assist others in transferring funds, offenses such as the crime of assisting information network criminal activities and the crime of concealing or disguising criminal proceeds may be involved;
For operators who, for profit-making purposes, organize fund payment and settlement on a long-term, continuous, and business-like basis, the crime of illegal business operations may further be involved.
Criminal law is the bottom line, not the ceiling.
But this statement should also be understood in reverse:
What you consider a "hard-earned fee" may be characterized in the case file as "illegal gains";
What you consider a "part-time job" may be evaluated in the judgment as "assisting conduct."
If you or a family member becomes involved in a case arising from money transfers, illegal payment-settlement schemes, or similar business, and the charge is disputed among the crimes of assisting information network criminal activities, concealment or disguise of criminal proceeds, and illegal business operations, you should focus as early as possible on the core issues, including the nature of the conduct, subjective knowledge, the amount involved, and the person's position in the hierarchy.
A digression
On the day of Xiao Xia's trial, his mother came from their hometown and, in the corridor, took me by the hand and said:
"The boy is just honest; when someone asked him for a favor, he helped."
In the case file, the bank cards in Xiao Xia's name had already processed more than seven million yuan.
"Honest" is not a talisman, and neither is "not understanding the law."
Some risks in this era often come dressed as part-time work, side jobs, or flexible employment, specifically targeting ordinary people who hope to increase their income.
Therefore, vigilance should be raised against any work that claims you can "make money with a flick of your fingers," "earn commissions by providing bank cards," or "earn returns by helping to run a few transactions."
Relevant legal provisions
Article 225 of the Criminal Law of the People's Republic of China [Crime of Illegal Business Operations]
Whoever, in violation of State regulations, commits any of the following illegal business operations, disrupting market order, and the circumstances are serious, shall be sentenced to fixed-term imprisonment of not more than five years or criminal detention, and shall also, or shall only, be fined not less than one time but not more than five times the illegal gains; if the circumstances are especially serious, shall be sentenced to fixed-term imprisonment of not less than five years, and shall also be fined not less than one time but not more than five times the illegal gains or have property confiscated:
(1) engaging, without permission, in the business of monopoly commodities or exclusive-sale commodities specified by laws and administrative regulations, or other commodities whose purchase and sale are restricted;
(2) buying or selling import or export licenses, certificates of origin for imports and exports, or other operating licenses or approval documents prescribed by laws and administrative regulations;
(3) without approval from the relevant competent State authorities, illegally engaging in securities, futures or insurance business, or illegally engaging in fund payment and settlement business;
(4) other illegal business operations that seriously disrupt market order.
Article 287-2 of the Criminal Law of the People's Republic of China [Crime of Assisting Information Network Criminal Activities]
Whoever, knowing that another person is using an information network to commit a crime, provides technical support such as internet access, server hosting, network storage or communication transmission, or provides assistance such as advertising promotion or payment settlement, and the circumstances are serious, shall be sentenced to fixed-term imprisonment of not more than three years or criminal detention, and shall also, or shall only, be fined.
Where a unit commits the crime in the preceding paragraph, the unit shall be fined, and the persons directly in charge and other persons directly responsible shall be punished in accordance with the provisions of the first paragraph.
Where an act under the preceding two paragraphs also constitutes another crime, conviction and punishment shall be determined in accordance with the provisions imposing the heavier punishment.
Article 312 of the Criminal Law of the People's Republic of China [Crime of Concealing or Disguising Criminal Proceeds and the Gains Therefrom]
Whoever, knowing that property is criminal proceeds or gains derived therefrom, conceals, transfers, purchases, sells on behalf of another, or otherwise conceals or disguises such property, shall be sentenced to fixed-term imprisonment of not more than three years, criminal detention or public surveillance, and shall also, or shall only, be fined;
where the circumstances are serious, the person shall be sentenced to fixed-term imprisonment of not less than three years but not more than seven years, and shall also be fined.
Where a unit commits the crime in the preceding paragraph, the unit shall be fined, and the persons directly in charge and other persons directly responsible shall be punished in accordance with the provisions of the preceding paragraph.
Relevant judicial interpretations and normative documents
- Interpretation of the Supreme People's Court and the Supreme People's Procuratorate on Several Issues Concerning the Application of Law in Handling Criminal Cases of Illegal Engagement in the Payment and Settlement of Funds and Illegal Purchase and Sale of Foreign Exchange (Fa Shi [2019] No. 1)
- Interpretation of the Supreme People's Court and the Supreme People's Procuratorate on Several Issues Concerning the Application of Law in Handling Criminal Cases of Illegal Use of Information Networks and Assisting Information Network Criminal Activities (Fa Shi [2019] No. 15)
- Opinions of the Supreme People's Court, the Supreme People's Procuratorate and the Ministry of Public Security on Several Issues Concerning the Handling of Criminal Cases of Assisting Information Network Criminal Activities (2025)
Case Sources
- Case of an intermediary in an underground bank's illegal purchase and sale of foreign exchange who was sentenced, based on publicly available judgment documents
- Typical cases of the crime of assisting information network criminal activities published by the Supreme People's Procuratorate
- The cases in this article are adapted from publicly available judgment documents on China Judgments Online and public news reports; all names are pseudonyms, and some details have been literary embellished
— Lawyer Lu · Focused on AI and internet criminal defense
