Fake Investment, Real Illegal Fundraising: NT$1 Billion Forex Scheme and Taiwan Banking Act Risks
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目錄
- 1. How Illegal Fundraising Schemes Operate
- 2. Severe Criminal Penalties Under the Banking Act
- 3. How Authorities Investigate Major Illegal Fundraising Cases
- 4. Practical Advice for Preventing Investment Fraud
- 5. What Should You Do If You Are Accused of Illegal Fundraising?
- 6. Legal Assistance from Chien Sheng International Law Firm
In recent years, as investment and wealth management have become increasingly popular, fraudulent investment schemes have continued to evolve in both scale and sophistication.
Authorities recently uncovered a major illegal fundraising case involving more than NT$1 billion.
A man surnamed Huang in Taichung was allegedly involved in creating a fraudulent website designed to closely resemble a well-known Australian foreign exchange investment platform. Together with an assistant, he reportedly organized investment seminars to recruit members and claimed that investors could earn weekly returns of 0.8% through managed foreign exchange margin trading.
Investors transferred cash or cryptocurrency into designated electronic wallets.
Although some investors were initially able to withdraw interest payments, Huang later allegedly disappeared.
After completing its investigation, the Changhua District Prosecutors Office indicted Huang and his assistant for suspected violations of Taiwan’s Banking Act, alleging that they had illegally raised more than NT$1.0158 billion.
The court also imposed restrictions preventing Huang from leaving Taiwan by air or sea.
1. How Illegal Fundraising Schemes Operate
Schemes of this kind are often structured as Ponzi schemes or high-yield investment programs.
They typically attract investors by promising:
■ principal protection;
■ guaranteed returns;
■ unusually high interest rates; or
■ stable profits with little or no risk.
However, under Articles 29 and 29-1 of Taiwan’s Banking Act, entities other than banks are prohibited from engaging in the business of accepting deposits.
Where a person receives funds from multiple or unspecified members of the public under the name of borrowing, investment, shareholder participation, or another arrangement, and promises or pays bonuses, interest, dividends, or other returns that are clearly disproportionate to the principal amount, the arrangement may legally be treated as the acceptance of deposits.
Conduct falling within these provisions may therefore constitute illegal fundraising under the Banking Act and expose the participants to severe criminal penalties.
2. Severe Criminal Penalties Under the Banking Act
Under Article 125 of the Banking Act, a person who illegally operates a deposit-taking business may face imprisonment for three to ten years and may also be fined between NT$10 million and NT$200 million.
Where the property or financial benefit obtained through the offense reaches NT$100 million or more, the penalties become substantially more severe.
The offender may face imprisonment for at least seven years, together with a possible fine ranging from NT$25 million to NT$500 million.
In the case described above, the alleged amount of illegally raised funds exceeded NT$1 billion. If the prosecution proves the relevant statutory elements and amount of criminal proceeds, the defendants may face the enhanced penalty provisions under the Banking Act.
3. How Authorities Investigate Major Illegal Fundraising Cases
Economic crime cases involving large amounts of money and numerous victims are typically investigated in great detail.
Investigators may attempt to reconstruct the entire financial and organizational network through methods such as:
■ reviewing bank account records;
■ tracing cryptocurrency transactions;
■ examining electronic wallets;
■ seizing computers and mobile devices;
■ reviewing communications records; and
■ identifying the flow of funds between participants.
For anyone drawn into such an investigation, the legal risks can be significant.
This applies not only to alleged organizers or decision-makers, but also to individuals accused of serving as accomplices, assistants, sales personnel, administrative staff, or other lower-level participants.
➡︎ Even a person who claims to have been unaware of the illegal nature of the operation may still be questioned extensively about their role, knowledge, compensation, communications, and involvement in handling funds.
At this stage, protecting one’s procedural rights is critical.
Statements made during questioning may later be used to determine whether the person knowingly participated in illegal fundraising, fraud, money laundering, or other offenses.
➡︎ For this reason, obtaining legal assistance at an early stage and having an attorney present during questioning can be an important part of protecting one’s rights.
4. Practical Advice for Preventing Investment Fraud
1. Be Cautious of Guaranteed High Returns
Before making any investment, investors should remain highly cautious of programs that advertise:
■ “guaranteed principal”;
■ “high guaranteed interest”;
■ “stable profits”; or
■ “no risk of loss.”
Investment should generally be conducted through legitimate and appropriately regulated financial institutions or platforms.
Returns that appear unusually high or unusually stable should be independently verified before any funds are transferred.
2. Stop Payments Immediately If Fraud Is Suspected
If you suspect that you may have entered a fraudulent investment scheme, stop making further payments immediately.
Preserve all available evidence, including:
■ chat records;
■ remittance receipts;
■ cryptocurrency transfer records;
■ electronic wallet information;
■ screenshots of the investment platform;
■ contracts or promotional materials; and
■ communications with recruiters or representatives.
Report the matter to the police as soon as possible.
5. What Should You Do If You Are Accused of Illegal Fundraising?
If you become involved in an investigation concerning illegal fundraising, remain calm and understand your procedural rights.
You may have the right to remain silent and to consult with legal counsel before making detailed statements.
A defense attorney can help clarify the person’s actual role in the operation.
Relevant questions may include:
Was the individual involved in investment decisions?
■ Did the person know that funds were being unlawfully raised?
■ Did the person recruit investors?
■ Did the person control or receive investor funds?
■ Did the person receive commissions or criminal proceeds?
■ Was the person merely performing ordinary administrative or employment duties?
■ Did the person have authority to make decisions on behalf of the organization?
These distinctions can be critical when determining criminal intent and the degree of legal responsibility.
➡︎ For example, if a person merely performed routine employment duties, did not participate in management or decision-making, and did not knowingly receive illegal profits, the defense strategy may focus on whether the prosecution can prove that the person had the necessary knowledge and intent to participate in the unlawful fundraising scheme.
6. Legal Assistance from Chien Sheng International Law Firm
Chien Sheng International Law Firm has extensive experience handling major economic crime cases, particularly those involving:
■ Banking Act violations;
■ illegal fundraising;
■ fraud organizations;
■ money laundering; and
■ complex financial investigations.
Our attorneys are familiar with both complicated financial regulations and the investigative methods commonly used by law enforcement and investigative authorities.
When a case is under intensive investigation, our legal team can assist with:
■ reviewing the client’s actual role in the alleged scheme;
■ analyzing financial records and transaction flows;
■ preparing for questioning by investigators or prosecutors;
■ protecting the client’s procedural rights;
■ evaluating whether criminal intent can be established;
■ distinguishing between organizers, accomplices, and lower-level employees; and
■ developing an appropriate criminal defense strategy.
At the same time, criminal liability cannot be determined solely by a person’s job title, employment relationship, or presence within an organization.
The prosecution must still establish the individual’s actual conduct, knowledge, intent, and degree of participation.
If you or a family member is facing an investigation involving illegal fundraising, investment fraud, Banking Act violations, or money laundering, Chien Sheng International Law Firm can provide professional legal analysis and criminal defense representation based on the specific facts and evidence of the case.Chien Sheng International Law Firm
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