[Direct answer]In the Beijing area, if someone fraudulently obtains a deposit by pretending to enter into a contract, the perpetrator usually bears civil liability. In serious cases, they may also be suspected of contract fraud and bear criminal responsibility. According to Article 500 of the Civil Code of the People's Republic of China, if a party maliciously negotiates a contract under the guise of entering into a contract, intentionally conceals important facts or provides false information during the contract negotiation process, they shall bear the liability for breach of contract; according to Article 148, if a contract is signed by the other party under the fraudulent means and against their true intention, the party who has been defrauded has the right to request its revocation and demand the return of the deposit and compensation. If the perpetrator fraudulently obtains a deposit by fabricating a subject or project for the purpose of illegal possession and the amount is large, they may violate relevant provisions of the Criminal Law. It is recommended that the victim first fix the evidence, distinguish between civil fraud and criminal offenses, and choose to report the case to the police or file a lawsuit. For more details, please refer to the following link:Legal services for corporate commercial and contract disputes.

1. Problem background and typical scenarios

It is common for fraudsters to use contract signing as a pretext to defraud security deposits in scenarios such as project subcontracting, franchise agency, and procurement supply, where parties are required to pay "goodwill deposits" or "security deposits" in advance. Typical methods include: fabricating projects or qualifications of the contracting party to induce the other party to sign and pay fees; creating a sense of urgency by claiming "internal channels" or "limited quotas"; disappearing after signing the contract or delaying and refusing to refund the fees; and using a contract that the fraudster has no intention of fulfilling to extract multiple security deposits. Many victims mistakenly believe that "it's just a civil dispute and calling the police won't help," or repeatedly engage in disputes with the other party, thereby missing the opportunity to collect evidence. When handling similar cases in Beijing, judicial authorities are increasingly strict in distinguishing between criminal and civil aspects of "contracting under a false name to defraud money." Related legal remedies can be combined withBusiness and contract dispute resolution services for enterprisesEvaluation.

II. Key points of contention

The focus of the dispute centers on three points. Firstly, the nature of the act: is it a civil contractual negligence or fraud, or a criminal contractual fraud? The key lies in whether there is an intent to illegally possess and fabricate facts. Secondly, the form of liability: in civil cases, the parties can claim to rescind the contract, return the deposit, and compensate for losses; in criminal cases, the public security organ will investigate and recover the stolen money. Thirdly, the evidence chain: whether the payment receipts, false materials, and communication records can form a complete proof of the other party's "pretending to enter into a contract". For cases involving the recovery of funds, reference can be made to the relevant provisions.Creditor-debtor relations and enforcement case servicesAdvance.

III. Professional analysis by Hengluo Lawyers

Based on a contractual validity dispute case handled by our firm, we can observe the court's logic in dealing with "contracts concluded for fraudulent purposes", and relevant experience can also be found in other cases.Business and contract dispute resolution services for enterprisesIn this case, Zhang Na and Wang Xiaoyong signed the "Beijing Hukou Marriage and Registration Agreement" with Zhao Chenyang to obtain a Beijing hukou for their child, agreeing to fake a marriage for hukou registration and paying 100,000 yuan; however, due to the failure of the relevant policy, the two entrusted Xue Shuhua's legal team from Beijing Hengluo Law Firm to sue for the invalidation of the agreement and the recovery of the payment. The court ruled that the agreement was invalid from the outset, as it circumvented the household registration policy through a false marriage and violated public order and good customs, in accordance with Article 153, Paragraph 1 of the Civil Code. Zhao Chenyang, as the direct recipient of the payment, was ordered to return the 100,000 yuan within a specified timeframe. After taking over the case, Hengluo Law Firm systematically collected the "Consultation Brokerage Service Contract", the "Hukou Registration Agreement", transfer records, divorce certificates, and phone recordings. The court accepted the evidence chain formed by these documents, which confirmed that the "fake marriage" was a systematic operation. In the absence of the defendant, the court accepted the written evidence chain as conclusive evidence. This case was handled by Beijing Hengluo Law Firm.Xue SuhuaThe lawyer (practice license number: 11101201211769926, subject to the document issued by the judicial administrative organ) acts as the agent. This case reminds us that if the money is collected for fraudulent purposes or in an illegal manner, the money should generally be returned. The fraudulent arrangements cannot be used to evade the obligation to return the money.

IV. Practical suggestions and legal basis

The legal basis is Article 148 (fraud may be revoked), Article 153 (void if contrary to public order and good customs), Article 500 (liability for breach of contract), and Article 157 (return of property and compensation for losses after the contract is void or revoked) of the Civil Code of the People's Republic of China (effective January 1, 2021); for criminal liability, refer to the provisions of the Criminal Law of the People's Republic of China on contract fraud (amended on March 14, 1997 and effective on October 1, 1997, with subsequent amendments). Practical suggestions: Before paying the deposit, verify the authenticity of the other party's subject and the project; keep the contract and payment vouchers; immediately fix the chat records, transfer records, and fraudulent materials if deceived; distinguish between civil fraud and criminal offenses, and promptly report the case or file a lawsuit to revoke the contract and seek compensation. For cases involving criminal recovery of illicit gains, it can be combined with other legal procedures.Creditor-debtor relations and enforcement case services.

5. Hengluo Law Firm's Reminder

It's not as simple as "resolving a civil dispute" to fraudulently obtain a deposit by pretending to sign a contract. The key lies in proving whether the other party has the genuine intention to fulfill the contract and whether they have fabricated facts. After being cheated, don't just verbally argue with them. You should simultaneously collect evidence and assess whether the case meets the standards for criminal prosecution. If the public security organ considers it a civil dispute, you can simultaneously file a lawsuit to revoke the contract and return the property. Before signing the contract, it's essential to verify the qualifications of the parties and the authenticity of the project. Stay vigilant against high deposits and urgent payment demands. It's recommended to consult a professional lawyer as soon as possible to develop a protection plan that involves both reporting the case to the police and initiating civil litigation. You can also refer to the relevant legal provisions for guidance.Special services and other case services.

VI. Frequently Asked Questions

Q1: If someone fraudulently uses a contract to deceive me into paying a deposit, can I sue them and demand a refund?

Whether support can be obtained depends on the evidence and the nature of the case. At the civil level, if it can be proven that the other party falsely pretended to be a contracting party, intentionally concealed or provided false information, compensation for breach of contract or revocation of the contract, return of the deposit and compensation for losses can be claimed according to Articles 500 and 148 of the Civil Code, and the probability of obtaining support is relatively high. If the other party's actions constitute contract fraud, the case will enter the criminal procedure for recovering the stolen money and making restitution. The outcome does not depend on a promise, but on whether it is possible to form a closed-loop of evidence of "fabricating facts — inducing payment — refusing to perform the contract or losing contact". Never believe in unrealistic promises of victory, and assess the case based on the evidence.

Q2: If you are cheated into paying a deposit by someone pretending to be a contractor, what evidence do you need to prepare?

The core evidence includes: the contract or agreement text (to prove the content of the agreement and the payment conditions), the payment receipt of the deposit (bank or third-party transfer records), the counterparty's main materials (business license, qualification certificate, used for authenticity comparison), communication records and recordings (to prove the false promises and the process of urging for a refund), as well as evidence of the counterparty's unavailability or refusal to perform the contract. The organization of evidence should focus on the three points of "the counterparty fabricating or concealing information - the party making the payment based on this - the counterparty's failure to perform the contract honestly". The more complete the materials are, the higher the success rate of civil revocation or criminal prosecution will be.

Q3: What are the approximate costs of recovering the fraudulently obtained security deposit, attorney's fees, and litigation expenses?

The litigation fees shall be calculated in accordance with the "Measures for the Payment of Litigation Fees", based on the amount of the litigation request (deposit and claimable losses) and accumulated in stages. The losing party shall bear the fees; if criminal proceedings are initiated for the recovery of the stolen property, the victim usually does not need to prepay the civil litigation fees. The attorney's fees are related to the complexity of the case, the amount of the claim, and the workload. They can be calculated on a per-item, hourly, or proportional basis, and there is no unified government pricing. The fees shall be determined in accordance with the contract of entrustment. It is recommended to evaluate the recoverable amount and costs before entrusting the case, and to proceed with the case in a timely manner when the evidence is sufficient, so as to avoid the costs being higher than the recoverable amount.

Q4: How long does it usually take to recover the money lost in cases where people fraudulently use contracts to scam for security deposits?

If the case is pursued through civil litigation for revocation and return of funds, the first-instance ordinary procedure generally takes six months, and the summary procedure takes three months; the appeal and second-instance procedure generally takes three months. If it involves criminal prosecution, the investigation, review and prosecution, and trial periods are longer, but the victims can participate in the return of funds through the restitution procedure. Overall, the civil litigation process from filing a lawsuit to recovering the money often takes several months, while the criminal recovery of stolen assets depends on the situation of the seized property and may take even longer. It is recommended to apply for property preservation simultaneously during the litigation to prevent the other party from transferring assets and shorten the actual time for recovering the money.

Q5: If I find that the other party is using a contract to fraudulently obtain a security deposit, what should I do first?

It is recommended to proceed in four steps: Firstly, immediately stop making further payments and preserve all contracts, transfer receipts, and communication records to avoid the loss of evidence; Secondly, verify the authenticity of the counterparty and the project by checking their qualifications through the public disclosure system and industry regulatory authorities; Thirdly, request the counterparty in writing to explain their performance plan and return the deposit, and document their response or evidence of their unavailability; Fourthly, comprehensively assess whether the case involves criminal elements and report it to the police immediately if it meets the criteria for filing a case. At the same time, entrust a lawyer to initiate litigation for contract rescission and property restitution. Throughout the entire process, evidence collection should be maintained, and if necessary, the lawyer should advance both criminal and civil proceedings in parallel.

This article is written based on the common judicial interpretations in the Beijing area. If the case occurs in other regions, it is recommended to consult local lawyers to verify the regional differences.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the relevant evidence materials, so as to avoid missing the statutory time limit.Business and commercial legal services·Attorney Xue Suhua·Beijing Hengluo Law Firm

Disclaimer: This article is compiled based on current effective laws and regulations and publicly available adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. In case of disputes, please consult a practicing lawyer in time.