Does Being Careless Mean You Intended to Do Wrong? An Interview with Attorney Kuo Hao-Jen

As a law student, I had heard in class about practical problems involving dummy accounts and had also seen related news reports. Before looking closely at the issue, however, my family, friends, and I all had the same simple reaction: shouldn't people be especially careful whenever money is involved? With that question in mind, we interviewed Attorney Kuo Hao-Jen, who has handled such cases, to better understand the problems that arise in practice.

When Drift-Net-Like Inferences of Intent Meet the Presumption of Innocence

Dummy-account cases often involve fraud under Article 339 of the Criminal Code. In practice, the central issue in an aiding-fraud charge is how to determine whether the defendant had the "intent to aid fraud." Put simply, to convict an account provider of aiding fraud, the prosecution must establish that the person was aware of the objective elements of fraud and intended the unlawful taking of property for themselves or a third party. Intent, however, is not limited to direct intent; conditional intent may also suffice.

In dummy-account cases, "foresight" means being able to anticipate the possible consequences of handing over one's account; "intent" asks whether, when providing the account, the person intended to assist a fraud ring in committing an offense. Judgments often state that "the defendant could foresee that, according to ordinary social experience, providing an account for another person's use would assist an unlawful fraud ring in defrauding others of property, yet nevertheless proceeded without that result being contrary to the defendant's intent." In this way, intent to aid fraud is inferred simply and intuitively from the objective fact that the account was handed over.

What should be a rigorous determination has become far more relaxed in judicial practice, ultimately resembling a presumption of guilt. Attorney Kuo Hao-Jen explained: "It works like a drift net. Basically, once a person of ordinary mental capacity hands over an account, a judge may conclude that the person could foresee the possibility but went ahead anyway. Intent then follows almost automatically as an inference-even without affirmative evidence. That is also how we end up with conviction rates above 90 percent."

"How Can It Be Such a Coincidence That Everyone Tells Me They Were Scammed?"

Attorney Kuo also noted that prosecutors and judges may already have handled hundreds of similar cases. From their perspective, it is therefore natural to think: "This is obviously a scam. How could you not have known?"

From the perspective of people deceived into providing their accounts, however, the situation may look very different. They may be seeking a private loan for the first time and mistakenly believe that "providing an account" is simply one step in the loan process. Financial distress and an urgent need for cash can reduce a person's ability to assess risk. Their circumstances are entirely different from those of people under less financial pressure, for whom the money at stake may not feel indispensable.

Attorney Kuo argues that the logic of "presumed intent" contains an implicit proposition: "If you know something might happen, then you intend it." But ordinary people do not think that way. Taken to its logical conclusion, the premise would mean there are no fraud victims at all, because every victim should have foreseen that the other party might be a fraud ring and nevertheless willingly transferred the money. Judges do not apply that logic to the people who lose money, yet they do apply it to people deceived into providing accounts. In other words, they apply an "ordinary-person logic" that ordinary people do not actually possess.

Fraud has not declined because the judiciary developed this powerful inferential tool. Compared with ten years ago, more than twice as many aiding-fraud cases now enter investigation. Some judges have gradually begun to apply the presumption of innocence and make a genuine, case-specific determination of intent, taking account of a defendant's circumstances and difficulties. Overall, however, the conviction rate remains above 90 percent. And when a case proceeds by summary judgment, the defendant's explanation may never meaningfully be heard.

Attorney Kuo once represented a university student in his early twenties who became involved in an assault case after falling in with the wrong crowd. Afraid his family would find out, he tried to raise NT$60,000 on his own to hire a lawyer. He found a private-lending website online. The other party gradually walked him through what appeared to be a loan process, saying they needed to review the cash flow in his account and confirm that it was not subject to compulsory enforcement, and instructed him to mail his ATM card. He discovered that the account had been designated a warning account only when his family tried to send him living expenses. He immediately contacted the bank and learned that he had been scammed. Because the police were already involved and he had explained that he too had been deceived, he did not separately report the other party for fraud. He was later indicted.

At the first hearing, the judge's hostility and disbelief were palpable. After all, once not just one or two people but the hundredth person comes before a judge saying, "I was scammed too," the judge may naturally begin to think, "How can it be such a coincidence that everyone tells me they were scammed?"
What most impressed the attorney while handling the young man's case was that, had the defendant simply trusted the justice system and not hired counsel, he likely would have been convicted quickly like defendants in many other cases. Yet in reality, most defendants in these cases are unrepresented.

When Structural Economic Vulnerability Meets Government Inaction

There are many dimensions to the roots of dummy-account fraud. Attorney Kuo cited the Taiwan Academy of Banking and Finance's 2020 Taiwan Financial Inclusion Survey, which found that 30 percent of respondents had less than NT$50,000 in savings, including 16.6 percent with no savings at all, while 11 percent could not obtain any form of credit. Behind those figures are households unable to absorb an unexpected financial shock. A single major event-an operation due to illness, or a car accident that prevents someone from working for several months-may leave a family unable to pay a mortgage, car loan, tuition, or credit-card bill. If family and friends cannot help, borrowing may be the only option. But people without stable payroll records may be denied bank loans, leaving private lending as their only remaining choice.

Yet the government has allowed fraudulent information to flood the private-lending market. A simple keyword search produces numerous websites, some run by fraud rings that brazenly display anti-fraud hotlines. Once contacted, people calling themselves "specialists" or "managers" provide detailed explanations of the supposed loan process, making the interaction appear legitimate and giving the impression that the lender is genuinely evaluating the borrower's repayment capacity.

People deceived into providing accounts are often economically vulnerable within existing social structures. The justice system casts a wide net that sweeps them up together with potential offenders, forcing people who are already struggling financially to stop working or take leave to travel among police stations, prosecutors offices, and courts across Taiwan-even to offshore islands-to respond to proceedings. They are then pressured to find money they do not have to compensate victims in hopes of receiving a sentence of six months or less, and finally told that they can avoid incarceration by paying another substantial commutable fine.

Police and prosecutors also face difficulties because cases must be transferred among jurisdictions. Even judges may hesitate to impose suspended sentences because defendants often have other cases pending; if another case later results in imprisonment, the suspended sentence may have to be revoked. The system itself is burdened by this cycle.
In that sense, many of the justice system's difficulties originate in inaction by administrative agencies further upstream.

"Does Being Careless Mean You Intended to Do Wrong?"

At the end of the interview, one of us challenged Attorney Kuo: Would strict adherence to the presumption of innocence mean that some guilty people are wrongly acquitted? Kuo replied that this is a value choice inherent in criminal justice: the system must decide how to weigh the risk of punishing the innocent against the risk of letting the guilty go free.

Attorney Kuo noted that legal education teaches us that the presumption of innocence is a fundamental principle of criminal procedure and exists to protect innocent people. If, in an effort to curb rampant fraud, the system would rather wrongly punish people who themselves were deceived in order to catch potential aiders of fraud, the result is the high conviction rate we see today. The judiciary must reconsider which choice it ought to make-and which choice criminal law itself requires.

Kuo believes that judges and prosecutors, deeply concerned about being deceived by fraud rings, often impose an extremely high burden on defendants to prove their innocence. They can identify a hundred reasons why a defendant's explanation seems implausible, yet the justice system can never stay ahead of fraud rings. Once judgments begin saying that a defendant had conditional intent because the defendant handed over an account without verifying the other party's identity, fraud rings can simply devise a new method-for example, first obtaining a third person's identification, then using it to deceive an account holder, and finally using that account to defraud a fourth person.

Some worry that fraud rings will develop "playbooks" teaching account providers how to respond. Kuo believes the proper inquiry is the circumstances and situation of each individual case; courts should not simply assume that a defendant's account was coached by a fraud ring to avoid liability. After all, if people can be deceived into handing over money, they can also be deceived into handing over accounts.

Attorney Kuo said that once a defendant who was deceived into providing an account enters litigation, the defendant must assemble extremely complete evidence and also encounter a judge who is relatively open-minded before an acquittal becomes possible. When the judiciary begins from a presumption of guilt, the judge evaluates the defendant's evidence through the prior assumption that the defendant is guilty. If the judge believes the defendant was insufficiently careful in dealing with the fraud ring, the judge may infer intent to aid fraud from that lack of caution.

Before the interview ended, Kuo posed a question of his own: "Can we really say that because someone was not careful enough, they intended to do something wrong?"

After the interview, I kept returning to that question.