NFT digital collection platform is involved in criminal charges. What are the common crimes?-web3资讯-ODAILY

Author of this article: Liu Zhengyao (senior lawyer at Shanghai Mankiw Law Firm)

The NFT or digital collection industry has been involved in a large number of criminal cases in the past two years. Among them, fraud is the most common crime, and fraud is the easiest crime to be sentenced severely, because many platforms can easily exceed 500,000 in the amount involved. (Investments on some platforms can easily exceed one million or even tens of millions). Once the amount of fraud reaches 500,000, the future sentencing will be more than 10 years, which is a serious felony.

However, a recent ruling by the Shanghai Minhang Court related to a case involving a digital collection platformA picture costs a thousand dollars? Beware of scams hidden behind “digital collections”! 》The case was closed for the crime of fund-raising fraud, and the defendants Xiao Zhang and Xiao Liu were sentenced to suspended sentences. Compared with the fraud crimes that frequently appeared in Shuzang Circle when they were involved in prison sentences, in a sense Xiao Zhang and Xiao Liu were lucky .

Today Liu Lu will talk about what crimes the digital collection platform will most likely be involved in if it is suspected of criminal crimes. What are the differences between these crimes?

01 Why is Shuzang Platform involved in punishment?

The non-compliant gameplay of the Shuzang platform is the main reason for its criminal involvement. According to the many similar cases represented by Lawyer Liu, the platform in question was mainly focused on opening the secondary market, and all or part of it had the following problems:

1. Self-buying and selling, malicious speculation

Some platforms will purchase digital collections themselves or through their employees, and wait for the opportunity to sell them at high prices. This rat warehouse style of play is essentially cutting off the leeks of ordinary users. In terms of criminal law evaluation, it is considered as illegal possession of other peoples property for the purpose. , may be suspected of fraud.

2. Additional issuance

The external publicity is that it is a limited edition, but the platform actually issues part of the collection for its own use, and then sells it off after the price soars. This is essentially the same as the previous situation, and may also be suspected of fraud.

3. Fake IP

They use false IP promotion as a gimmick to attract attention. They claim to be well-known artists in a certain circle, but they are actually art technicians found on a certain website for less than 100 yuan; they even simply use it, and whoever gets the best copy gets it. This could easily constitute intellectual property infringement or even a crime.

4. False on-chain

The biggest difference between digital products or NFTs and traditional electronic images is that they are unique and have their own place on the blockchain. However, in practice we find that some platforms claim to issue NFTs, but they are not actually on the chain. ; Or the given blockchain address is fake to deceive novice users. These behaviors also constitute a crime of fraud.

5. Incomplete qualifications

We know that to be a data collection platform, especially a platform that has opened a secondary market, you must have at least three qualifications: ICP and EDI business licenses, online articles, and blockchain information service registrations. Of course, if you have art business registrations and auction business licenses It would be great if the certificate is registered or approved. But the reality is often very skinny. Some platform operators have nothing but an innocent heart that is passionate about Shuzang. Although insufficient qualifications will not necessarily result in the police coming to your door, once a criminal offense is involved, it is too late to remedy the situation, and it is often difficult for lawyers to find favorable arguments.

02 What crimes will Shuzang be involved in?

In current practice, there are three main crimes related to the Shuzang platform: fraud, fund-raising fraud, and illegal absorption of public deposits.

1. Crime of fraud

Fraud is the crime most frequently triggered by non-compliant Shuzang platforms. What is fraud? The provisions of the Criminal Law do not directly stipulate that according to ordinary peoples simple understanding, it is to defraud other peoples money. Legal practitioners may consider whether the perpetrator fabricated facts and concealed the truth to cause the victim to fall into a wrong understanding, and the victim disposed of property based on the wrong understanding. In the end, the victim loses his property and the perpetrator or a third party gains property. The reason why there are so many people convicted of fraud is because Shuzang’s many ways of playing games often make the judicial authorities believe that the platform has the “purpose of defrauding others of their property.” Translated, it means that the platform is for cutting leeks. Common situations are the above-mentioned rat warehouse and malicious intent. Hype, large-scale issuance, etc. Once convicted of fraud, future convictions and sentencing will be relatively severe. According to current regulations, once the amount involved is between 3,000 and 10,000 yuan, the person can be sentenced to a fixed-term imprisonment of up to 3 years (specific standards vary from province to province). Once the amount involved exceeds 500,000 yuan, you can be sentenced to more than 10 years in prison. We know that once the Shuzang platform is involved in criminal punishment, it is easy for the amount to exceed 500,000.

2. Crime of illegally absorbing public deposits

Collection platforms sell collections ranging from thousands to tens of thousands. Some platforms clearly promote features such as high returns, which may trigger the crime of illegally absorbing public deposits. The constitution of this crime requires four conditions: illegality, publicity, inducement, and sociality. Illegality means absorbing funds in violation of national financial regulatory regulations; openness means publicity to the public through the media; inducement means that the fund-raising platform promises to repay principal and interest or provide returns; sociality means that the objects of the absorbed funds are unspecified members of the public. (On the contrary, raising funds among relatives and friends does not constitute this crime). The Shuzang platform does not have a financial license and promotes through the open Internet. The target of raising funds is an unspecified public. The platforms that have troubles often have high-yield and high-return incentives and publicity. When these four characteristics are met, once the judicial authority determines that it has disrupted the countrys financial order, it is likely to constitute this crime. According to regulations, as long as one of the conditions is met: the amount of illegally absorbed exceeds 1 million, or the number of illegal deposit recipients exceeds 150, or the direct loss caused by non-abduction to depositors exceeds 500,000, you may be sentenced to up to 3 years in prison. .

3. Crime of fund-raising fraud

This crime was sentenced by the Minhang Court this time. The perpetrator’s red line behaviors mainly include fictitious IP parties, disclosing high profits to unspecified objects through the Internet, self-buying and selling, inflated transactions, etc. The key is that the platform directly stops the server in the later period. renewal, closed the platform and ran away. This is also the main difference between the crime of illegally absorbing public deposits and the crime of fund-raising fraud: whether there is an illegal purpose of possessing the funds raised. The crime of fund-raising fraud means that the perpetrator has no intention of repaying the money when illegally raising funds, while the perpetrator of the crime of illegally absorbing public deposits has no such intention. If the perpetrator closes the platform, runs away, loses contact, and refuses to refund the money, it is very likely to be deemed a fund-raising fraud by the judicial authorities. The threshold for this crime is that as long as the amount of funds raised exceeds 100,000 yuan, the person may be sentenced to fixed-term imprisonment of not less than 3 years but not more than 7 years.

03 Conclusion

The data storage market has been on a downward trend in the past two years, but the more depressed the market becomes, the more important it is to adhere to the bottom line of compliance operations. Otherwise, bad money will drive out good money, and the data storage industry will be completely cool. As a criminal lawyer, Liu Lu suggested that all data storage platforms should pay attention to avoid the red line behaviors mentioned above. Even if you have to exit due to poor management, you must formulate a reasonable exit plan to avoid group rights protection incidents that may lead to the platform being involved in prison.