How to Settle Fraud, Money Laundering, and Aggravated Fraud Cases in Taiwan: Seeking a Suspended Sentence or Sentence Reduction
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目錄
- 1. Why Is Settlement Important in Fraud and Money Laundering Cases?
- 2. Settlement Does Not Automatically Mean Withdrawal, Deferred Prosecution, or a Suspended Sentence
- 3. A Safer Process for Fraud Settlement
- 4. How Much Should Be Paid in a Fraud Settlement?
- 5.Can Settlement Help Obtain a Suspended Sentence?
- 6.Can Settlement Lead to a Sentence Reduction?
- 7. Money Laundering: Confession, Criminal Proceeds, and Cooperation
- 8. What If the Victim Refuses to Settle?
- 9. What Should a Fraud Settlement Agreement Include?
Defendants in fraud, aggravated fraud, and money laundering cases may seek settlement with victims. However, settlement does not automatically result in non-prosecution, acquittal, a suspended sentence, or a sentence reduction.The main legal value of settlement is to compensate victims, repair the harm caused by the offense, and provide prosecutors or courts with evidence relevant to the defendant’s post-offense conduct and sentencing.
Signing a settlement agreement is only the beginning. Actual payment, timing, percentage of compensation completed, the defendant’s attitude, criminal role, number of victims, and overall circumstances may be more important than simply having a signed document.
Fraud, aggravated fraud, and money laundering also have different legal elements and consequences. Each victim, transaction, and payment should therefore be reviewed separately.
1. Why Is Settlement Important in Fraud and Money Laundering Cases?
In an ordinary fraud case, compensation may be relevant to the defendant’s post-offense conduct under Article 57 of Taiwan’s Criminal Code.
Fraud is generally prosecuted by the state. Therefore, a victim’s forgiveness or settlement does not automatically terminate the criminal case. Nevertheless, repayment, continued performance of a payment plan, and genuine efforts to compensate the victim may affect prosecutorial decisions and sentencing.
Aggravated fraud may involve circumstances such as participation by three or more offenders, impersonation of government agencies or public officials, or fraudulent communications directed to the public.
In these cases, courts may consider the defendant’s role, number of victims, total losses, duration of participation, division of tasks, and organizational structure.
Settlement may help demonstrate efforts to repair the harm, but it does not eliminate the elements of aggravated fraud. Settling with only some victims also does not resolve the losses suffered by other victims.
Money laundering requires separate analysis. Compensation paid to a fraud victim does not automatically eliminate money laundering liability or resolve confiscation issues.
At least three categories of money should be distinguished:
1. The victim’s actual financial loss.
2. The defendant’s personal compensation or criminal proceeds.
3. Property or funds potentially subject to seizure, confiscation, or recovery as money-laundering assets.
These amounts may overlap in some cases, but they are not legally identical.
2. Settlement Does Not Automatically Mean Withdrawal, Deferred Prosecution, or a Suspended Sentence
Settlement, restitution, mediation, withdrawal of a complaint, deferred prosecution, suspended sentencing, and plea bargaining are different legal concepts.
Ordinary fraud, aggravated fraud, and commonly prosecuted money laundering offenses generally do not end simply because the victim withdraws a complaint or signs a settlement.
A victim’s forgiveness may still be important evidence of compensation and post-offense conduct, but it does not replace the prosecutor’s or court’s legal determination.
Deferred prosecution is a prosecutorial disposition made during the investigation stage. A suspended sentence, by contrast, is ordered by a court after conviction.
Plea bargaining is another formal criminal procedure involving an agreement with the prosecutor, the defendant’s guilty plea, and judicial review. An ordinary settlement with the victim does not automatically become a plea agreement.
3. A Safer Process for Fraud Settlement
Before negotiating settlement, the defendant and counsel should first identify the procedural stage, alleged offenses, victims, disputed transactions, and applicable law.
A practical process may include:
■ Confirm the case number, charges, and procedural stage.
■ List each victim, transaction, loss, and amount already returned.
■ Separate victim losses from the defendant’s personal criminal proceeds.
■ Contact victims through counsel, mediation, or another appropriate formal channel.
■ Present a realistic lump-sum or installment payment proposal.
■ Use traceable payment methods and preserve receipts.
■ Clearly document the scope and payment terms of the settlement.
■ Submit settlement agreements and proof of payment to the prosecutor or court.
Defendants should avoid repeatedly calling, messaging, or personally visiting victims. They should never pressure victims to change statements, withdraw allegations, conceal losses, or sign documents.
Likewise, defendants should not contact alleged accomplices to coordinate testimony or delete evidence. Such conduct may additional criminal, procedural, or sentencing risks.
4. How Much Should Be Paid in a Fraud Settlement?
Taiwan law does not establish a universal settlement amount or a formula stating that paying a particular percentage guarantees a suspended sentence or sentence reduction.
Settlement amounts may be negotiated based on:
■ The victim’s actual financial loss and amounts already recovered.
■ The defendant’s role and personal criminal proceeds.
■ The number of victims and transactions.
■ Potential civil liability among multiple defendants.
■ The defendant’s income, assets, necessary living expenses, and dependents.
■ Whether immediate payment or a realistic installment plan is possible.
In multi-defendant cases, settlement documents should clearly explain whether one defendant’s payment reduces the victim’s total claim against all defendants or only that defendant’s agreed share.
The same compensation should not be counted multiple times by different defendants as if each had independently paid the victim in full.
An installment agreement is only a promise to pay over time. It is not the same as full performance.
This distinction is especially important when relying on statutory provisions that require payment of the full settlement or mediation amount within a specified period.
5.Can Settlement Help Obtain a Suspended Sentence?
Under Article 74 of Taiwan’s Criminal Code, a suspended sentence generally requires the court to impose imprisonment of no more than two years, short-term imprisonment, or a fine, together with the applicable criminal-record requirements.
The court must also determine that immediate execution of the sentence is unnecessary.
Therefore, settlement cannot replace the statutory requirements for a suspended sentence.
Actual compensation and victim forgiveness may nevertheless be important when the court evaluates post-offense conduct, restoration of harm, and the risk of reoffending.
Courts may distinguish among defendants who:
■ Reached settlement and paid in full.
■ Reached settlement but paid only part of the amount.
■ Signed an agreement but made no payment.
■ Attempted to settle but were unable to reach an agreement because the victim declined.
Full compensation may be favorable, but it is never an automatic guarantee of a suspended sentence.
A suspended sentence may include conditions such as compensation, apology, payments to the government, community service, treatment, counseling, or other measures designed to protect victims and prevent reoffending.
If installment compensation is incorporated into the judgment, the defendant should strictly comply with the payment schedule. Serious violations of suspended-sentence conditions may a risk that the suspension will later be revoked.
6.Can Settlement Lead to a Sentence Reduction?
➡︎ Under Article 57 of the Criminal Code, courts consider factors including motive, methods, personal circumstances, victim losses, and post-offense conduct when determining the sentence.
Settlement, actual payments, victim opinions, and continued restitution efforts may all be relevant.
However, Article 57 does not provide a mathematical reduction based on the percentage of compensation paid.
➡︎ Article 59 may allow a sentence below the statutory minimum where the circumstances are clearly deserving of compassion and even the minimum sentence would be excessively severe.
Settlement and full restitution may contribute to that assessment, but settlement alone does not automatically satisfy Article 59.
This is particularly important in aggravated fraud cases involving large losses, numerous victims, extended participation, or organized criminal activity.
➡︎ Taiwan’s Fraud Crime Hazard Prevention Act contains special sentence-reduction provisions concerning surrender, confession, and victim compensation.
➡︎ Under Articles 46 and 47, statutory benefits may depend on requirements such as surrendering or confessing at the legally required stages and paying the full amount agreed upon through settlement or mediation within the statutory six-month period.
The exact starting date of that period and other requirements depend on the provision being invoked.
These provisions use discretionary language and do not guarantee a sentence reduction or exemption simply because the defendant appears to satisfy the formal requirements.
Counsel must also determine:
■ Whether the offense falls within the statute.
■ Whether the defendant legally surrendered or consistently confessed.
■ When the six-month period began.
■ Whether the full agreed amount was actually paid within that period.
■ Which version of the law applies to the date of the offense.
Victim compensation, personal criminal proceeds, and the total proceeds obtained by the fraud organization should also be distinguished rather than treated as the same amount.
7. Money Laundering: Confession, Criminal Proceeds, and Cooperation
Taiwan’s Money Laundering Control Act contains separate provisions concerning surrender, confession, payment or surrender of criminal proceeds, and cooperation leading to the identification of other principal offenders or accomplices.
These requirements are separate from settlement with the victim.
Simply giving investigators a name, nickname, phone number, or account does not necessarily satisfy statutory cooperation requirements.
Where a reduction depends on authorities discovering another offender because of the defendant’s information, the statement generally must be truthful, specific, verifiable, and causally connected to the investigative result required by law.
Because Taiwan’s money laundering laws have been amended over time, the applicable version should be determined according to the date of the offense and the rules governing changes in criminal law.
8. What If the Victim Refuses to Settle?
Victims have the right to refuse settlement, decline installment payments, or request that all communications go through counsel or a mediation body.
A defendant must not pressure, threaten, repeatedly contact, or publicly disclose personal information about the victim.
If settlement cannot be reached, the defense may still preserve evidence showing legitimate efforts to repair the harm, including:
■ Partial compensation already paid.
■ Applications for mediation.
■ Communications through attorneys or official procedures.
■ Records showing that the victim declined settlement.
■ Evidence of the defendant’s financial ability and realistic payment plan.
■ Other lawful efforts to compensate or repair the harm.
In appropriate circumstances, counsel may also evaluate whether a legal deposit or another payment mechanism is available.
However, a unilateral deposit does not automatically mean that the victim has agreed to a settlement or forgiven the defendant, and it does not necessarily satisfy statutory provisions requiring a completed settlement and full payment.
9. What Should a Fraud Settlement Agreement Include?
A properly drafted fraud settlement agreement or mediation record should clearly identify:
■ The parties and authorized representatives.
■ The criminal case and case number.
■ The victims and transactions covered.
■ Total loss, amounts already paid, and remaining balance.
■ Lump-sum or installment payment terms.
■ Payment dates, methods, and receiving account.
■ Consequences of late payment.
■ The scope of civil claims being resolved.
■ Payment relationships among multiple defendants.
■ Matters that remain outside the settlement.
■ Appropriate treatment of personal information.
The agreement should not falsely state that a victim can determine whether prosecutors will indict, what sentence a court will impose, whether property will be confiscated, or whether the defendant will receive probation.
Likewise, phrases such as “payment guarantees the case will be dismissed” should be avoided.
Every payment should be documented through bank records or written receipts. After full payment, the defendant should obtain evidence clearly stating the amount received and the scope of claims that have been satisfied.
Q1: Will a fraud case be dismissed after settlement?
Not necessarily. Fraud and aggravated fraud are generally prosecuted by the state. Settlement may affect prosecutorial discretion and sentencing but does not automatically terminate the case.
Q2: Is settlement useful in aggravated fraud cases?
Yes, it may demonstrate compensation and post-offense rehabilitation. However, the defendant’s role, number of victims, losses, criminal record, organizational involvement, and other circumstances remain important.
Q3: Does paying the victim eliminate money laundering liability?
No. Victim compensation and money laundering liability are separate issues. Confiscation and criminal proceeds may also require independent analysis.
Q4: How is the settlement amount calculated?
There is no universal formula. The victim’s actual loss, recovered funds, defendant’s role and proceeds, multiple-defendant liability, and realistic ability to pay should all be considered.
Q5: Can installment payments help obtain a suspended sentence?
They may help demonstrate genuine restitution efforts, but they do not guarantee a suspended sentence. Courts will also consider whether payments are actually being made as promised.
Q6: Can a suspended sentence still be possible if the victim refuses settlement?
Potentially, depending on the overall case. The defendant may document legitimate attempts at compensation, mediation, partial payment, and other restorative efforts, but these are not equivalent to a completed settlement.
Q7: Does settlement mean I no longer need to attend court?
Usually not. A settlement does not automatically terminate a publicly prosecuted criminal case. Continue to comply with all prosecutor and court summonses unless officially informed otherwise.
Chien Sheng International Law Firm has handled fraud cases in which defendants sought suspended sentences or sentence reductions through settlement and restitution.Legal assistance may include reviewing the charges and applicable law, organizing victims and financial transactions, calculating losses and payments already made, developing realistic settlement proposals, communicating through appropriate channels, drafting settlement agreements and installment plans, and submitting restitution evidence to prosecutors or courts.
Counsel may also evaluate how settlement interacts with confession, plea bargaining, the Fraud Crime Hazard Prevention Act, the Money Laundering Control Act, sentencing arguments, and suspended-sentence requirements.
No lawyer can guarantee that paying a particular amount will result in non-prosecution, a suspended sentence, or a sentence reduction. The outcome depends on the applicable law, evidence, criminal role, actual compensation, and the prosecutor’s or court’s determination.
※ This article provides general legal information and does not constitute individualized legal advice, a guarantee of any case outcome, or an attorney-client relationship.
Fraud and money laundering laws may change, and the applicable legal consequences may differ depending on the date of the offense, procedural stage, defendant’s role, and evidence. Issues involving confession, cooperation with investigators, criminal proceeds, restitution, suspended-sentence conditions, or plea bargaining should be evaluated based on the applicable law and complete case record.
This reduces both medical risks and potential legal exposure.
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