Telecom fraud are organized group crimes that take advantage of the security loopholes created by flourishing information technology and financial liberalization to set up call centers and conduct various fraud offense within or outside national border.
The perpetrators at call centers will call over to targeted victims, start the tricks and fraudulently lead the victims to send their money to designated dummy accounts. After some money laundering process, all the illegal proceeds are transferred among several dummy accounts before being finally distributed to the partners in the syndicate.
In early days, some Taiwanese set up call centers in Taiwan and defrauded people in Taiwan. Later, they started to run call centers in foreign countries, defrauding people in Mainland China and having money returned to Taiwan and picked up by their Taiwanese co-perpetrators. Recently, it becomes gradually that Taiwanese and Chinese mainlanders cooperate to operate call centers abroad to scam Chinese and Taiwanese people all over the world.
Taiwan government is fully aware that cross-border telecom fraud offenses have been rampant so all competent authorities have begun to revise their policy objectives and work plans in order to crack down such kind of crime in concerted efforts. Below we will demonstrate the important policies and the effect of enforcement at the present stage:
1. Improve the effectiveness of combating cross-border fraud via cooperation
To combat fraud, MOJ has collaborated with the Judicial Yuan, Mainland Affairs Council, Ministry of Foreign Affairs, Financial Supervisory Commission, Ministry of Transportation and Communications, National Communications Commission, Ministry of Interior Criminal Investigation Bureau, Ministry of Justice Investigation Bureau (MJIB), Ministry of the Interior National Immigration Agency and Taiwan High Prosecutors Office to establish An “Inter-Agency Platform against Cross-Border Fraud” on June 3, 2016. The followings are some important resolutions passed by the Platform.
2. Improving the legal framework and mechanism for combating telecom fraud
The Amendment of OCPA came into force on April 19, 2017 and fraud rings could be punished severely under the current OCPA. Moreover, for helping deprive illegal proceeds of the fraud rings, the MOJ amended MLCA and added Art. 15 to punish offenders who collect money for the fraud rings. Art.18.2. of MLCA was amended as well to enlarge the range of confiscation. The amendment came into force on June 28, 2017. As a result, telecom fraud could not only be charged pursuant to Art.339-4 of Criminal Code of the Republic China but also under OCPA and MLCA. In recent year, major cross-border telecom fraud syndicates were successfully prosecuted and convicted with heavy penalty.
Over years the principal legal basis for Taiwan’s cooperation with foreign countries with respect to mutual legal assistance was the “Law in Supporting Foreign Courts on Consigned Cases", apart from a handful of criminal mutual legal assistance agreements with some countries and the general "reciprocity principle" in international law. However, it is a law lacked detailed provisions as well as predictability and stability, that it did not meet the needs of complex mutual legal assistance context in practice.
On April 10, 2018, Taiwan's legislature passed the Mutual Legal Assistance in Criminal Matters Act, which officially went into force on May 4, 2018. This Act provides a comprehensive set of statutes that governs the avenues and scope for making and taking mutual legal assistance requests, with a specific provision aiming at solving the current difficulty of executing incoming requests for recovering the seized assets as proceeds of crime. Taiwan has also established a single point of contact for receiving requests so that the agencies responsible for carrying out the requests may effectively control the time and quality of responses to the requests of the mutual assistance. Foreign countries jurisdiction may also request assistance from the MOJ directly in emergency situations under the new law. This not only greatly reduces the response time but also ensures that the requesting countries will receive the necessary assistance in a timely manner. The Act is only part of our endeavor to provide other countries with stable, definitive and prompt judicial assistance.
3. The accomplishment of law enforcement
Since the amendment of OCPA, the total number of telecom fraud offenders charged under OCPA was 506 in 2017, accounting for 69.5% of persons charged with OCPA and the number was raised to 2983 in 2018, accounting for 87.48% of persons under the charge alike. The number of persons who were imposed of compulsory labor was 7 in 2017 and it grew up to 104 in 2018.
Since the amendment of MLCA, there were 6 fraud cases charged with MLCA in 2017, accounting for 30% of MLCA cases; and the case number roared up to 1684 in 2018, representing 92.32% of MLCA cases.
MOJ set up “special task forces for the recovery of criminal proceeds” and established “the Guidelines for Prosecuting Authorities to Pursue Proceeds of Crime”. It is imperative to apply the new laws especially on telecom fraud and fraudulent fundraising offenses so as to prevent perpetrators from benefiting from the crimes. As such to ensure that it does not pay to commit crimes, with a view to stemming these crimes eventually. In particular, the “Guideline for Prosecuting Authorities to Pursue Proceeds of Crime” have been applied successfully by both the MJIB and Agency Against Corruption Ministry of Justice in seizing and confiscating.
In addition, in order to enhance the capacity of investigation into the monetary losses from frauds and to assist legal enforcement agencies in finding out criminal money trails, the police has established a linking mechanism with financial institutions so that necessary actions can be taken promptly in suspected fraudulent withdrawals, which will help prevent bank account owners from being deceived and taken advantage of. Apart from that, Taiwan has established the “Regulations Government the Deposit Accounts and Suspicious or Unusual Transactions” in 2006. The courts, the Prosecutors Offices or the judicial police may notify a bank to place an account under criminal investigation on the watch list, and all transactions on that account will be suspended. Immediate outcome: to facilitate mutual assistance among members of the financial institutions, the financial institutions are now obliged to work together to combat fraud in accordance with the “Guidelines for Reporting Fraudulent Cases between Members of the financial institutions.
Lastly, Taiwan government will continue implementing strict measure to fight against the fraud rings and make every effort to deprive the illegal proceeds of crimes pursuant to the newly-amended MLCA and Criminal Code of the Republic of China, in order to provide a well secured living environment which is free from malicious frauds and other offenses alike.