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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Cogito Ergo Sum who wrote (58980)	12/15/2009 9:12:32 PM
From: TobagoJack	Read Replies (2) \| Respond to of 217825

btw, imagine when/if such dictate is announced in empire usa :0) just in in-tray scmp.com Pay off cards or go to jail: Beijing Credit-risk concerns prompt new ruling Ng Tze-wei Dec 16, 2009 Consumers using mainland credit cards, including those from Hong Kong, could be jailed if they default on credit card debts to mainland banks three months after receiving the second warning notice, the nation's top judiciary body has ruled. The exact liabilities of Hong Kong card holders depend on the contract they sign with the mainland issuer. All credit cards issued on the mainland are subject to local laws. Cards issued by mainland banks in Hong Kong are subject to Hong Kong law unless it is otherwise stated in the contract, legal experts say. "If mainland law applies, a Hong Kong card holder who defaults on payment could also be subject to this criminal charge," Chinese University of Political Science and Law commercial law professor Li Shuguang said. While mainland law states malicious overdraft could be a criminal offence, yesterday was the first time the judiciary authorities had clarified the regulation. The Supreme People's Court and the Supreme People's Procuratorate have jointly issued a judicial explanation, saying that card holders would face charges if they fail to pay the settlement three months after receiving the second notice letter from banks. This comes amid growing concerns on the mainland over the rising credit risks to the fragile financial system. While the use of credit cards on the mainland is not common, the authorities are worried bad debts could grow as more young people start to adopt a free-spending lifestyle. In Shenzhen's Luohu district, a court heard and issued convictions for 33 cases of malicious overdraft in the first eight months of this year. Beijing resident Xiao Wang, 22, was the first credit card user subject to this charge last year in Beijing's Xicheng District Court, a report in the Beijing Evening News said. In September 2006, he bought a mobile phone with his newly approved credit card, and also used the card to withdraw 5,000 yuan (HK$5,700) in cash. Shortly afterwards he lost his job, and thought it was acceptable to delay payment until he had money again. The court ruled that he had showed malicious intent, and gave him a six-month jail term suspended for a year, and fined him 20,000 yuan - the total amount of his overdraft plus interest plus a 9,000 yuan penalty. This month, the People's Bank of China - the central bank - announced that 7.42 billion yuan in credit card debt was more than six months overdue in the third quarter - a 126.5 per cent jump from the same quarter last year, equivalent to 3.4 per cent of all credit card debt on the mainland. Between January and August, police said they had investigated 6,362 credit card fraud cases around the country, twice as many as the same period last year. "Along with the rapid development of our credit card industry, credit card-related crime is also increasing, with the continued appearance of new methods," Supreme People's Court deputy chief Xuan Xueguo said. "In particular, activities such as falsifying applications, credit card fraud and illegal cash withdrawals are happening and becoming an industry." The judicial explanation clarified the sentencing and different scenarios that amount to the crimes of credit card counterfeiting and fraud. But the clause that stirred most public concern was the one on "malicious overdraft". It specified six scenarios in which defaulters might be considered overdrawing for illegal purposes, including if they know they have no ability to repay or if they use the overdrawn cash to go on a spending spree. The starting point has been raised to an overdrawn amount of 10,000 yuan, up from 5,000 yuan. The penalty runs from a 20,000 yuan fine to a life sentence, depending on the size of the overdraft, and how "malicious" the defaulter was. Any sum above 1 million yuan could lead to a life sentence. Some commercial law experts are baffled that credit card default payments need to be dealt with using criminal law, which is unusually harsh compared with that of many other countries and regions. But most banks on the mainland are state-owned, so any debt would inevitably have an impact on state coffers. "Say for example, Taiwan and the US both use bankruptcy law to handle the situation, but we don't have such a law in China yet," said Li, the Chinese University professor. "The use of criminal charges puts all the responsibility on the consumers, whereas this problem could have been resolved through civil law and better controls on the lenders' side."