TAIWAN Trends and Developments Contributed by: Jaclyn Tsai, Teresa Huang, Jaime Cheng and Lilian Hsu, Lee, Tsai & Partners
2024, offering professional investors the oppor - tunity to invest through sub-delegation. II. Fraud Crime Prevention Measures A. Legislative background and regulatory framework In response to the evolving nature of fraud crimes, the Executive Yuan established the “Anti-Fraud Command Centre”, with participa - tion from five government agencies: the Minis - try of the Interior, the National Communications Commission (NCC), the FSC, the Ministry of Jus - tice and the Ministry of Digital Affairs (MODA), to co-ordinate and supervise inter-ministerial fraud prevention strategies and actions. From a legal perspective, Taiwan announced amendments to four related laws on 31 July 2024: the FCHPA, the Money Laundering Control Act, the Com - munication Security and Surveillance Act, and the Code of Criminal Procedure. Key points are summarised as follows: (1) FCHPA As the core regulation for fraud prevention, the FCHPA addresses the insufficiency of civil and criminal laws in deterring fraudulent activities and protecting victims. The FCHPA includes the following key measures: • Enhanced criminal liability for specific fraud offences. • Obligations for financial, telecommunications and digital economy industries to implement anti-fraud measures. For details, see “II.B. Key Anti-Fraud Obligations Across Indus - tries”. • Strengthened mechanisms for victim protec - tion. (2) Money Laundering Control Act Key amendments to this act require VASPs and third-party payment providers to complete nec -
essary registration or filing. Non-compliance may result in criminal liability. These measures aim to improve government oversight, foster a culture of compliance and prevent such entities from being exploited as tools for transferring proceeds of the crime. (3) Communication Security and Surveillance Act Recent amendments broaden the authority of law enforcement agencies to conduct surveil - lance and access online records, enhancing the efficiency of criminal investigations. (4) Code of Criminal Procedure A new chapter on “Special Compulsory Meas - ures” regulates the use of technological meth - ods, such as GPS or other tracking tools, to locate suspects. These amendments aim to balance the rights of suspects with the goals of criminal investigations. B. Key Anti-Fraud Obligations Across Industries (1) Financial institutions and VASPs The FSC is the governing authority, and financial institutions and VASPs are subject to anti-fraud obligations under the FCHPA. Key requirements include: • Strengthening the CDD process for abnormal accounts or credit cards suspected of being involved in fraud. Subsequent measures may include suspending all or part of the transac - tion functions of the account or declining to establish business relations. Relevant records of CDD and transactions should be main - tained. • When performing the above requirements, enquiries may be made with other financial institutions or VASPs. The queried party is required to offer the relevant information.
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