Introduction:
In "Currency Exchange Through an Acquaintance's Introduction: the 'Intermediary' Was Unexpectedly Convicted as a Principal Offender and Sentenced to Eight Years—Is This Unjust? —Do Not Introduce Others to Buy or Sell Foreign Exchange; Be Careful Not to Be Convicted of the Crime of Illegal Business Operations! (Part One), the main discussion was, in the case involving Sun for the crime of illegal business operations,why an intermediary who brokered the introduction constituted the crime of illegal business operations. This article continues by addressing why Sun was a principal offender rather than an accessory.？
Author of this article: Attorney Shao Shiwei
01
Cards on the table—no more pretending
Ms. Sun was in fact a well-known Shanghai figure in introducing currency exchange.
From this picture, Ms. Sun appears to be the ringleader of illegal currency exchangers. But will the ringleader necessarily be determined to be a principal offender? After all, because she had already been detained three times previously, Ms. Sun kept firmly in mind that she could only make introductions and could not directly participate in buying and selling. So why was she still arrested this time? Moreover,in the previous instances, direct participation in buying and selling foreign exchange resulted only in sentences of half a year to a year, minor matters,
yet this time she merely helped introduce people, and was unexpectedly sentenced to eight years.！
Underground banks form a circle, money brokers form a circle, and clients seeking currency exchange naturally form their own circle as well. Within their respective circles, everyone must be responsible for their own conduct.
Money brokers, or introducers, may be recognized as accessories (an accessory may receive a lighter or reduced penalty); however, to seek accessory status, several points should be avoided as far as possible. Let us see what money brokers can learn from Ms. Sun as a cautionary example:
1. Keep a low profile; earning a little money is enough
Underground banks are also a business of earning the spread, just like U merchants. The difference is that U merchants only earn the spread between buying and selling, whereas this trade, in addition to the interest-rate spread, also charges a separate service fee. Ms. Sun said that generally, for every USD 100 transaction, the underground bank adds an interest-rate charge ranging from 20 to 60 cents, while the money brokers' commission depends on how they agree with the underground bank.
In Shanghai, these lower-level money brokers all dealt with Ms. Sun, who was the top figure in Shanghai for the Ma family underground bank. Obviously, Ms. Sun did not keep a low profile at all. Judging from her extensive prison record, she presumably wanted to build a big enterprise (the secrets of making money are all written in the Criminal Law), so how could her eyes be fixed on just a few scattered coins?
2. Controlling the finances equals status
Just as a boss pays employees their wages, the referral fees of other intermediaries were arranged and paid by Ms. Sun;
The accounts of the Ma family underground bank were also provided externally by Ms. Sun;
3. Queen of the circle
Although clients with currency-exchange needs approached intermediaries they knew, these intermediaries all dealt uniformly with Ms. Sun. As shown in the diagram, Ms. Sun was the center of the universe.
If one wishes to assert accessory status, then one certainly cannot operate on such a high-profile, large-scale basis. Being too conspicuous makes it very difficult not to be a principal offender.
02
Referring a contact card leads to a sentence of three years with a four-year reprieve
Who exactly are the people in Ms. Sun's network?
Answer:Bank client managersand the like. In any case, they are all people who have opportunities to get to know influential figures.
This is still the same diagram. In "the first part of this article," the facts of the case have already been introduced: Bao had a need for foreign exchange and approached his cousin Wang A, who asked his colleague Ge whether Ge knew anyone; Ge then introduced Sun, and Sun introduced the Ma family, who could provide foreign exchange services, and CAD equivalent to RMB 40 million was exchanged.
A and B are both client managers at a Shanghai branch of a certain bank(Do you feel surprised and caught off guard?)
But this is actually normal, because bank staff are the people closest to clients who have foreign exchange needs.
Moreover, A and the foreign exchange client Bao are also cousins. A thought that she certainly had to help with her cousin's matter! So she asked her colleague B whether B had any resources. B merely recommended Ms. Sun,but on this single transaction alone, B made a net profit of RMB 40,000This is only one transaction; the judgment also records many people and many transactions. All these introducers had to dowas perhaps simply, like B,
forward a WeChat contact card and then wait to collect an introduction fee(and wait to be summoned by the police)and that was all.。
The court held that A (with 11 years of banking experience) and B, as bank employees, knew the State's foreign exchange administration policies better than ordinary "scalpers." Outcome: a sentence of three years' imprisonment with a four-year suspension.
03
Other miscellaneous legal issues
1. Is it safe to exchange currency for people in Hong Kong?
Because Ms. Sun's household registration is in Hong Kong, she also travels back and forth between the mainland and Hong Kong. Hong Kong is not subject to foreign exchange controls. If an actor's illegal foreign exchange trading activities, in their entire transaction chain, all take place in Hong Kong, then of course there is no problem. But if the "matched-order" (duiqiao) method is used and there are RMB transactions in the mainland, then this breaks through our country's criminal
jurisdiction. Under the Criminal Law, if either the act or the result of a crime occurs within the territory of the People's Republic of China, the crime is deemed to have been committed within the territory of the People's Republic of China.
Many friends who trade virtual currencies also ask Lawyer Shao: Can I just go to Hong Kong and do xxx? Truly, no.
2. If I made no profit or extremely little profit, can the punishment be reduced?
If you introduce someone to a currency exchange and you make no profit, then it depends on whether the other party is exchanging for their own personal use or has other illegal purposes. Introducing someone who is purely exchanging for their own personal use free of charge (a regular Good Samaritan) may result in an administrative penalty, but will not involve criminal liability.
If you take money, judicial practice does not look entirely at whether the amount you received is large or small; conviction may also be based on the business volume (the total amount exchanged). For example, in Case No. (2020) Hu 0114 Xing Chu 1598, the intermediary obtained a benefit fee ofseveral thousand yuan, and was sentenced totwo years and two months(whereas the seller who provided the foreign exchange was sentenced to two years, so the intermediary was sentenced to a more
severe penalty than the seller). From the perspective of the judicial authorities, the intermediary is not a minor-role offender.
04
A digression
The Ma Group in this case (Mr. Ma in the diagram) is truly a rather mysterious organization. According to reports, when the police were investigating this case, one "Mr. Ma" of this Ma Group had previously appeared in the "Ma" Group "underground bank" case that the Ministry of Public Security cracked many years ago, but at that time slipped through the net due to insufficient evidence.
Ms. Sun, who was arrested this time, is the Ma Group's representative in Shanghai, but it seems that the Ma Group has still not been apprehended to this day. This is not necessarily because Ms. Sun is loyal and refuses to disclose information; the truth is generally that... she probably really does not know.
If anyone has leads on the Ma Group, you can provide them to the police.
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