Debate Tournament Post-Event Reflection: Should Providing Mule Accounts Be Punishable—The Clash and Trade-offs Among Legislative, Judicial, and Administrative Branches

Following the Supreme Court's Criminal Grand Chamber Ruling No. 108-Tai-Shang-Da-3101 in judicial practice—which addressed whether individuals who provide mule accounts should be punished and how—the Ministry of Justice proposed an amendment to the Money Laundering Control Act in an attempt to codify the punishability of "providing mule accounts," thereby kicking off this series of discussions.

As I was writing my master's thesis on a related topic, I was invited to listen online to this debate tournament and symposium co-hosted by the JRF and the CDPA. I would like to thank the JRF for their contribution to promoting relevant discussions through this series of events. The following content is a record of key points from the event, and is not strictly written in the order of the debate clashes and Q&A sessions. At the end of this article, I also offer some personal observations beyond the scope of that day's discussion.

Debate Clash Point 1: Should It Be Punishable? Whom Does Providing a Mule Account Harm?

The judiciary aims to "ascertain facts and apply the law," with the goal of balancing "catching those who ought to be punished (false negatives)" and "avoiding the punishment of those who ought not to be punished (false positives)." Yet, these two metrics typically rise or fall together. When system sensitivity is high, it is easy to "catch those who ought to be punished," but this simultaneously brings the side effect of increasing instances of "punishing those who ought not to be punished." Some individuals provide mule accounts out of naivety, believing it to be harmless; some intend to earn a small consideration without fully realizing the risks; and others know full well that their accounts will be used illegally with the intent to aid crimes. The difficulty for legal practitioners lies in striking the right balance, weighing false negatives against false positives.

As to whether the act of providing a mule account is punishable, we must first ask: "Whom does this act harm?" During the debate, several lines of argument from the affirmative side can be summarized as follows:

First, the property rights of defrauded victims are compromised. Shielded by layers of mule accounts, this "precedent act of money laundering" helps fraud syndicates launder illicit proceeds, leaving black money untraceable.

Second, following the preceding point, the existence of mule accounts makes the trajectory of cash flows difficult to trace, creating obstacles for judicial prosecution. Not only is it hard to find the source of the fraud or money laundering, but confiscation is also often limited to the lower ends of the criminal chain—such as low-asset couriers or account holders—leaving victims with no recourse for compensation.

Third, it disrupts financial order. If arbitrary use of others' accounts is permitted, transaction processes that traditionally rely on overt names lose their reference value, which is detrimental to maintaining existing transparent cash flows and undermines public trust in the financial order.

Any of the above concerns seemingly warrant protection, and "unjustified" provision of accounts appears to lack a legitimate basis under a balancing of interests. Regardless, if one takes the view that providing a mule account is punishable, the question of "how to punish (how to regulate)" naturally follows.

Debate Clash Point 2: How to Punish? The Money Laundering Control Act as Special Criminal Law?

Under current law, individuals who provide mule accounts may constitute offenses under the Money Laundering Control Act (money laundering crime) and the Criminal Code (fraud crime), but the "subjective elements" remain the focal point of contention regarding criminal liability. The defense argued that perpetrators cannot foresee that their accounts will be used for crimes, and thus lack subjective criminal intent and should not be convicted; the prosecution argued that with the massive public awareness campaigns stating that "accounts must not be provided for others' use," perpetrators cannot possibly be completely unaware, and therefore their subjective intent is undeniable. Looking at current judicial practice, among the guilty verdicts rendered by courts, the expansion of oblique intent in certain cases has frequently been criticized for lacking sufficient reasoning and resembling a "shoot first, aim later" approach. Supreme Court Criminal Grand Chamber Ruling No. 108-Tai-Shang-Da-3101 has its background context, yet it still fails to curb trial judges' routine, boilerplate judgments in subsequent individual cases, the prosecution's absent burden of proof, and the defense's righteous arguments for acquittal. The evidentiary issue of whether an accomplice "has knowledge of the principal offender's acts" perpetually lingers.

Therefore, on December 28, 2021, the Ministry of Justice proposed an amendment to the Money Laundering Control Act, in which Article 15-1 explicitly stipulates: "Anyone who, without justifiable reason, provides a financial account to another person and engages in the acts listed in Article 2 shall be sentenced to imprisonment for not more than 3 years." This provides an explicit statutory basis for punishing those who supply mule accounts, carrying a lighter penalty—at least compared to the Money Laundering Control Act (statutory penalty of up to 7 years' imprisonment for money laundering) and the Criminal Code (statutory penalty of up to 5 years' imprisonment for ordinary fraud, and imprisonment from 1 year to 7 years for telecommunication fraud).

Regarding mule account cases, what the draft amendment still needs to test is "whether it can resolve the existing problem of difficulty in determining subjective elements." Furthermore, how "without justifiable reason" in Article 15-1 of the draft will be applied also became a core focus of contention between both sides in this debate tournament. An actor may indeed have justifiable reasons for handing over an account, such as processing a loan or proxy stock trading; if there is a foundation of trust with the recipient, this seemingly forms part of the ordinary scenery of daily life, and cannot necessarily be condemned across the board. However, as discussed in the debate, such account sharing among friends and relatives typically does not lead to subsequent money laundering activities, and naturally would not constitute the proposed crime of providing an account.

It is worth noting the inherent limitations of legislation. Constrained by its abstract nature, the law is generally incapable of exhaustively listing every specific scenario so as to avoid omission; thus, it is understandable that the text opts to use "without justifiable reason," which leaves room for interpretation to narrow the scope of punishable account-provision acts. Nevertheless, attention must still be paid to whether the "scope of criminalization is overly broad." Moreover, the reduced penalties in the draft may perhaps alleviate the helplessness of the judiciary, providing an exit from the current legal dilemma where "the offense is minor, yet the penalty is severe." This direction is indeed worthy of affirmation.

However, criminal legislation penalizing mule accounts has always faced concerns regarding the "overly premature criminalization of abstract endangerment offenses." The act of providing an account by the perpetrator is not yet inherently unlawful, and whether subsequent actual harm results is not certain either, leaving the "protected legal interest" unclear. As part of special criminal law, whether the act of providing a mule account warrants the application of criminal penalties is a question that deserves more rigorous discussion—the deficiency of administrative measures is indeed an unfulfilled endeavor of the draft. "Preventive measures beforehand" surpass "punitive measures afterward"; it would be far more ideal if relatively minor punishable acts of unjustifiably providing accounts could be regulated through administrative control instead of criminal punishment.

On the other hand, however, it is undeniable that the international trend in money laundering prevention is "risk-based," meaning the intensity of anti-money laundering regulatory measures varies according to the level of risk in order to reasonably allocate operational costs—if administrative authorities were to require banks to perform thorough KYC on every account applicant with low risk, it would seem overly burdensome for financial institutions. Nevertheless, reducing the number of "idle accounts" in the hands of the public (through means such as levying account custody fees) and cutting off available account numbers at the source remains a viable direction.

Reflections from Watching the Debate

In my humble opinion, individuals who arbitrarily provide accounts should be punished (although administrative law is superior to criminal law for this purpose). I welcome the codification of the penal basis in this draft; perpetrators who unjustifiably provide accounts cannot shirk their responsibility for safeguarding those accounts. Since possessing a bank account is a special privilege through which one can expand the scope of financial activities, regulations governing the "unjustified provision of accounts" can also be established—much like how holders of driver's licenses must obey traffic rules, and multiple violations may lead to license revocation.

Obligations are born alongside rights, and mature citizens should be held accountable for their choices. The law may not prohibit lending one's car to someone else to drive, but if a car accident occurs, insurance premiums rise and the results of related evidence investigations must be borne by oneself; by the same token, if one lends a bank account, the subsequent legal risks should not be completely absolved either. If there are vulnerable individuals who provide accounts due to ignorance or financial hardship, this is a matter of culpability (a lack of subjective expectation), rather than an issue of illegality.

At the very least, however, if punishment is to be inflicted, it must be crystal clear, rather than abandoning the burden of proof via objective evidence to establish subjective intent and arbitrarily expanding "oblique intent" during conviction. If the draft passes, we look forward to legislators explaining the "without justifiable reason" provision of Article 15-1 in the legislative reasoning, and we await practical application in individual cases to flesh out its concrete form—such as the discussion in the symposium regarding "intent to be used for another's crime" or "provision for consideration" as potential examples.

Finally, there is legal education. Although waving the banner of "education"—which is almost universally true—always sounds well-founded and hard to refute, concluding with it risks sounding lazy, yet in mule account cases, it is profoundly real. Legislation serves as a policy declaration and is closely tied to public opinion (the legitimacy of legislators stems from a democratic foundation); therefore, legislation can be—and ought to be—part of legal education. With the civil law age of majority lowering to 18, at which point young adults can independently open bank accounts at financial institutions without statutory agents, whether family and social education outside of school has adequately enabled newly aged adults to understand the risks of "unjustifiably providing accounts"—and consequently identify with and be willing to abide by the law—will soon face real-world challenges.