Fraudulent litigation remains at high level
Despite intensified supervision, the level of fraudulent litigation has remained at a high level over the past three years, the Supreme People’s Procuratorate said in a recent report.
Fraud litigation refers to individuals or entities using means such as forging evidence or making false statements to initiate civil litigation, thereby undermining judicial order or seriously infringing on the legitimate rights and interests of others.
Common scenarios include collusion between spouses to fabricate joint debts, and collusion with others to fabricate debt relationships and agreements involving material assets.
According to the white paper on civil prosecution work issued by the SPP on March 9, procuratorates nationwide corrected 9,359 civil litigation cases involving false litigation last year, 9,731 cases in 2022, and 8,829 cases in 2021.
Disputes over loan, labor and sales contracts together accounted for over 70 percent of the cases, it said.
The annual work report of the SPP for 2023, which was approved by the National People’s Congress on March 11, stated that procuratorial organs prosecuted 925 individuals for fraudulent litigation.
The work report mentioned a case in Liaoning province handled last year involving Tan, who controlled multiple companies and was also the head of a mafialike organization, and who offered bribes to judicial officials to evade debts through fraudulent litigation.
In one instance, Tan assisted one of his companies in evading debts by fabricating loan contracts and then sued the same company via another one of his companies, demanding 15 million yuan ($2 million) in “debts”. The court completed the case filing and mediation in one day. Tan later used the execution process to transfer substantial assets.
Procuratorates in Liaoning supervised and corrected 60 relevant civil and administrative cases, promoted 124 self-corrections by courts, and initiated investigations into 12 judicial personnelrelated crimes and prosecuted 18 individuals involved in organized crime and related crimes.
According to the white paper, fraudulent litigation cases are diverse in type and have serious social consequences. They often involve private lending, divorce property division, company division or merger, bankruptcy, labor disputes, intellectual property protection or insurance.
Some cases, such as those involving social security and medical insurance, or funds for rural development and housing, involve the embezzlement of substantial State-owned and public funds, disrupt economic and social order, and even harm processes such as arbitration and notarization, seriously undermining the country’s legal order, it said.
The SPP has launched a special campaign targeting fraudulent litigation, and procuratorates in various regions have proposed measures to address loopholes in litigation.