How Chinese Fraud Law Applies to Foreign Defendants — and What Defence Options Exist

Fraud under Chinese criminal law covers a wider range of conduct than in many common law countries — from straightforward deception to contract fraud, fundraising fraud, and loan fraud. Foreign nationals can face fraud charges in business, investment, and personal contexts. This article maps the legal terrain and available defences.

Fraud under Article 266 of the PRC Criminal Law is defined as defrauding public or private property through fictitious facts or concealment of the truth, with the amount involved being the principal determinant of sentencing severity. The Supreme People's Court has issued interpretations establishing sentencing thresholds: "relatively large" (generally RMB 3,000–10,000, varying by province) attracts up to 3 years; "large" (RMB 30,000–100,000) attracts 3–10 years; and "especially large" (RMB 500,000+) attracts 10 years to life. Guangdong's thresholds are at the higher end of these ranges given the province's economic profile.

The Spectrum of Fraud Offences Under Chinese Law

Foreign nationals accused of fraud in China often face charges arising from business transactions — where the line between aggressive commercial practice and criminal misrepresentation is contested — or from online platforms where the defendant's role in the alleged scheme may be peripheral. The prosecution must prove intent to defraud, not merely that a counterparty lost money. A defence strategy will examine: the defendant's role and knowledge within the business or platform; whether representations made were false or merely optimistic; whether the alleged victims conducted their own due diligence; and whether any losses have been compensated, which can support a mitigation argument.

For case-specific advice, contact C&Z Partners for a confidential consultation.

Primary legislation: Criminal Law [CN official]; Criminal Procedure Law [CN official]
Also relevant: PSAPL [CN official]; Exit and Entry Administration Law [CN official]
Official sources: Criminal Law (CN)
Key interpretation: SPC & SPP Guiding Opinions on Plea Leniency (2019)
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