Defrauding Your Parents in China: Why It Is Still the Crime of Fraud — RMB 10 Million in Oxford Deposit Squandered, 11 Years in Prison

The short answer

• The crime of fraud does not turn on whether the person deceived was family; it turns on whose money was actually lost. In this case the parents were only the middlemen who did the borrowing — the people who actually paid out and actually lost were relatives and friends, so the shield of an internal family financial dispute did not hold.
• The line between borrowing and defrauding is the intent to illegally possess: whether the money was used for the agreed purpose once received, whether there was the ability to repay when it was borrowed, and whether restitution was made after the matter came to light are the three sets of facts most often used to infer it. Here the Oxford admission was fabricated, almost all the money was squandered, and nothing was repaid — all three at once.
• RMB 500,000 is the threshold for an especially huge amount in the crime of fraud (Article 1 of Judicial Interpretation No. 7 [2011]), and the statutory penalty runs from ten years or more up to life. RMB 10 million is twenty times that threshold; 11 years is within the statutory range and at the lighter end of it.
• Where property is obtained by defrauding a close relative and the close relative forgives the offender, the matter may generally be dealt with as not a crime — that is a real rule (Article 4 of the same interpretation). But it requires the victim to be a close relative and forgiveness to be given. Here the victims were relatives and friends and the money was not repaid, so it does not apply.
• Money given away to a girlfriend, to relatives or to friends to spend can be recovered (追缴) where it can be shown that they acquired it for nothing or at a clearly low price; where the recipient made a bona fide acquisition, it is not recovered.

1. First, trace the money: who borrowed it, and who lost it

Taking the facts from an oral account relayed from public reporting, the case runs like this: a man surnamed Wang in Wuxi, Jiangsu, went abroad in 2016 to attend high school, and his parents sold two properties to pay for it. After returning to China in 2022, he said he was applying for a postgraduate place at Oxford University and needed to freeze a large deposit with a financial institution, refundable once his studies were done, and he produced what were presented as an offer letter and a certificate from the financial institution. His parents believed him and borrowed about RMB 10 million from relatives and friends on his behalf. Once the money arrived, not a single yuan of it went on an application or on study; Oxford never admitted him; and about RMB 9.7 million of it went on two successive girlfriends — travel, luxury goods, renting and buying property, and buying cars and gifts for their relatives. In 2023 his maternal uncle, seeing that the money was never repaid, reported the matter, and the court sentenced him for the crime of fraud to 11 years of fixed-term imprisonment and a fine of RMB 100,000.

The point people argue about most in this case is: a son deceiving his own parents — how does that become a criminal offence?

The reasoning attributed to the court is that the parents were merely instruments: they were not the true victims, they were pushed by their son’s lies into going out and borrowing money from relatives and friends, and it was the relatives and friends who disposed of property on the basis of false information and suffered the loss. In criminal law this structure is called using another person as an instrument of the fraud, and the person deceived, the person who disposes of the property and the victim need not be the same person. What really determines the characterisation is whose money was ultimately gone.

There is a further layer: the parents signed promissory notes (借条) in favour of the relatives and friends, so the civil obligation to repay stays with them. Even where the criminal case is decided and the money cannot be recovered, the relatives and friends can still sue the parents on those notes — recovery of illegal gains and the civil debt are two separate tracks and do not cancel each other out.

2. Civil loan or criminal fraud: the dividing line is the intent to illegally possess

Failing to repay a loan is, in the overwhelming majority of cases, a civil dispute; only where the borrower never intended to repay when borrowing, or borrowed knowing that repayment was impossible, does the conduct come within the crime of fraud. Article 266 of the Criminal Law requires that the offender fabricate facts or conceal the truth so that the other party falls into error and disposes of property, and it requires at the same time that the offender act with the intent to illegally possess.

The intent to illegally possess is subjective and can only be inferred from objective facts. In practice the courts commonly look at these sets of facts:

• Whether the stated reason for borrowing actually existed. Here the Oxford application, the admission and the frozen deposit did not exist at all — this was pure fabrication, not a case of circumstances changing later.
• Whether the money was actually used for something else. It was agreed to be for study; in fact almost all of it went on personal spending and on the girlfriends — the classic pattern of a change of use plus squandering.
• The ability to repay at the time of borrowing. The parents had already sold two properties to fund his education, he himself had no source of income, and neither principal nor interest on RMB 10 million could be repaid.
• Conduct afterwards. Whether there was restitution, whether there was evasion, whether the lies continued. Here nothing was repaid after the matter came to light, and the lies were kept up to buy time.

These points have to be weighed together. Conversely, where the reason given was true, the money went into a business, and the borrower negotiated actively over repayment after losses, the matter normally stays within the civil sphere even where the amount is large. The distinguishing question is not whether there was a lie, but whether the lie was told in order to take the money and not give it back.

3. Which sentencing bracket RMB 10 million falls into

Article 266 of the Criminal Law of the PRC (text, excerpted): Where public or private property is defrauded in a relatively large amount, the offender is to be sentenced to fixed-term imprisonment of not more than three years, criminal detention or public surveillance, and is to be fined or ordered to pay a fine alone; where the amount is huge or there are other serious circumstances, to fixed-term imprisonment of not less than three years and not more than ten years, and a fine; where the amount is especially huge or there are other especially serious circumstances, to fixed-term imprisonment of not less than ten years or life imprisonment, and a fine or confiscation of property.

The amount thresholds are set by Article 1 of the Interpretation of the Supreme People’s Court and the Supreme People’s Procuratorate on Several Issues Concerning the Specific Application of Law in the Handling of Criminal Cases of Fraud (Judicial Interpretation No. 7 [2011]) (text, excerpted): Where the value of defrauded public or private property is between RMB 3,000 and RMB 10,000, between RMB 30,000 and RMB 100,000, or more than RMB 500,000, it is to be identified respectively as a relatively large amount, a huge amount and an especially huge amount; the higher people’s court and the people’s procuratorate of each province may set the standard applied locally within those ranges.

Anything above RMB 500,000 enters the bracket of ten years or more; RMB 10 million here is twenty times the threshold. Eleven years sits at the lighter end of that band — usually because of factors such as pleading guilty and accepting punishment, not because the amount was small.

4. Why the rule on defrauding close relatives did not save him

The rule does exist. Article 4 of Judicial Interpretation No. 7 [2011] (text): Where property is obtained by defrauding a close relative and the close relative forgives the offender, the matter may generally be dealt with as not a crime. Where it is genuinely necessary to pursue criminal liability for defrauding a close relative, the handling should still be lenient as the circumstances warrant.

It has two preconditions, and neither is met here:

• The victim must be a close relative. For criminal procedure, close relatives (近亲属) are husband, wife, father, mother, son, daughter, and siblings of the same parents. The money here came from relatives and friends, not from the parents’ own funds; what the parents carry is a debt owed to relatives and friends, and they were not the persons defrauded.
• The close relative must forgive. Even if the parents were treated as victims, the rule is only that the matter may generally be dealt with as not a crime, not that it must never be prosecuted; where the amount is especially huge, restitution is refused and the circumstances are egregious, liability is still pursued — merely with leniency.

So the idea that defrauding your own family is not a crime is a widespread misunderstanding. Put accurately: the victim must be a close relative, the close relative must forgive, and neither the amount nor the circumstances may be serious — all three together, and only then may the matter be dealt with as not a crime. Take one away and the conclusion can flip.

5. Can money given to the girlfriend be recovered?

Article 64 of the Criminal Law: All property illegally obtained by a criminal is to be recovered or ordered to be returned; lawful property of the victim is to be returned without delay.

Article 10 of Judicial Interpretation No. 7 [2011] sets out the boundary of recovery from third parties in more detail (text, excerpted): Where defrauded property is used to pay a debt or transferred to another person, and that person took it knowing it to be defrauded property, acquired it for nothing, acquired it at a price clearly below market price, or acquired it on the basis of an illegal debt or of illegal or criminal activity, it is to be recovered in accordance with law; where the other person made a bona fide acquisition, it is not to be recovered.

Applied to this case: the flats, cars, luxury goods and transfers the girlfriend received, if they were acquired for nothing (as gifts), fall within the scope of recovery in principle; if she can show that she paid consideration and did not know where the money came from, that is a bona fide acquisition and is not recovered. In practice, knowledge is inferred from chat records, from the flow of funds, and from whether her spending matched her income.

Recovery is carried out by the judicial authorities on their own initiative; the victim does not have to bring a separate action. For property that the criminal proceedings did not reach, a separate civil action can be brought after the judgment takes effect.

6. What to do if this happens in your own family

• First, pin down whether the reason was true. Offer letters, fee notices and financial-institution freeze certificates should all be verified with the body that issued them; do not circulate screenshots inside the family. A fabricated document is itself the hardest evidence there is.
• Leave a trace of the money trail. Whose money, through whose account, to whom, and what the stated purpose was — match each item to the bank statements; where relatives and friends lent the money, keep the promissory notes, the transfer records and the chat records together.
• Decide what you want before you report. A criminal case may lead to recovery of the money, and may also lead to a prison sentence for the person; if the aim is only to get the money back and to preserve the family relationship, an action to rescind under Article 148 of the Civil Code of the PRC (the defrauded party has the right to request rescission) is also a route.
• When you report, do not only say that he defrauded me; say what he fabricated, which payment I disposed of because of it, and how much was lost. The elements of the crime of fraud are built on exactly those three points.
• If you are the person accused, focus on two things: what the money was actually used for, and whether you are able to make restitution. The timing of restitution (full restitution before the first-instance judgment) has a very direct effect on sentence in this kind of case.

A few caveats

The facts in this article come from an oral account relayed from source material; I was not able to verify the name of the court, the case number or the details of the judgment independently. The court name given in the material does not match the administrative divisions of Wuxi, which may be a transcription error, so no specific court is named. The sentencing outcome likewise appears only in that account, and an individual case is also affected by factors such as pleading guilty and accepting punishment, restitution and voluntary surrender; it should not be taken as the expected outcome for similar cases.

The legal part quotes the text of the Criminal Law currently in force and of Judicial Interpretation No. 7 [2011], and the provisions themselves can be checked. What is genuinely difficult is the line that separates a loan from a fraud — it is not in the statutes, but in the bank flows, the chat records and the order in which things happened.

If you are facing a large financial dispute within your family, or have been accused of fraud and need to respond, you are welcome to contact Wang Xin: phone 186-0113-9509, WeChat wang223040.

This is an English edition of Wang Xin’s original Chinese article, 骗父母的钱，为什么能定诈骗罪？一千万「留学押金」被挥霍一空，判了11年. It explains the law of the People’s Republic of China in general terms and is not legal advice for any particular case; outcomes depend on the specific facts and on how local authorities apply the rules.