[Direct answer]Based on the judicial practice in Beijing, a criminal risk check is a professional service provided by lawyers to enterprises before their daily operations and major decisions. It involves a systematic criminal compliance review of the business model, internal systems, employee behavior, and transaction structures to identify potential risks that may violate criminal laws and provide rectification plans. It is not about handling cases, but about preventing problems before they occur. According to the Criminal Law of the People's Republic of China (implemented on October 1, 1997 and amended several times) and the Criminal Procedure Law of the People's Republic of China (amended on October 26, 2018), it is far better for enterprises to identify and take timely measures to prevent risks such as embezzlement, commercial bribery, and false invoicing before the occurrence of cases than to deal with them passively after the fact. It is recommended that high-risk industries and rapidly expanding enterprises regularly conduct such checks. For more details, please refer to the following link:Criminal defense and criminal case filing services.

I. Problem Background and Typical Scenarios

Many business owners don't realize that their business activities have violated the law until they are investigated by the authorities. Typical scenarios include: the company bribing public officials to secure a project, only to later find out that the company involved in the bribery; the finance department issuing VAT invoices for "tax avoidance", with the cumulative amount reaching criminal levels; the sales team using exaggerated rebate schemes, which are deemed as pyramid selling or fraud; and the actual controller using personal accounts to handle funds, blurring the boundaries between embezzlement and normal business operations. Criminal risk audits expose these hidden dangers before they become actual cases, giving enterprises the opportunity to self-inspect and correct their mistakes. For issues involving contracts and corporate governance, they can be addressed in conjunction with other relevant departments.Business and contract dispute services for enterprisesLet's sort things out together.

II. Key points of contention

There are three main controversies surrounding criminal risk inspections. Firstly, the boundaries: the inspection is a compliance consultation, which cannot replace criminal defense and does not mean that the company has been "exempted from liability". The key lies in whether the company will genuinely rectify the problems after the inspection. Secondly, the triggering point: the earlier the better. It is best to conduct the inspection before financing, mergers and acquisitions, expansion, or senior management changes, rather than waiting for the emergence of reporting clues. Thirdly, confidentiality and implementation: companies are concerned about exposing problems, so lawyers must provide actionable rectification measures based on confidentiality obligations, rather than just giving vague reminders. In practice, it is particularly crucial to grasp the dual-penalty system for corporate crimes and the scope of responsible personnel. It is recommended to evaluate the risks of natural persons simultaneously and refer to relevant guidelines for reference.Creditor-debtor relations and enforcement case services.

III. Professional analysis by Hengluo Lawyers

Taking a major criminal case handled by our firm as an example, we can see the value of professional criminal litigation capabilities. On June 16, 2024, the defendant, Zhang Daqiang, accelerated his car to hit the laboratory due to a dispute, resulting in the death of Zhao Gang on the spot and injuries to Zhang Bin and Li Yuanzheng. The victim's wife, Zhao Gang, entrusted Attorney Liu Liqiang of Beijing Henglu Law Firm to represent her in the criminal incidental civil action. After thoroughly reviewing the case files, the lawyer refuted the defendant's defenses regarding subjective intent, voluntary surrender, the victim's fault, and the nature of the crime one by one, and argued that the crime should be defined as intentional homicide (rather than endangering public safety by dangerous methods) and be punished severely. The key points are: the language before the impact revealed the motive; the defendant accelerated and did not avoid the impact when he was less than five meters away from the door, which was enough to prove the intent to kill; and his claim of brake failure and repeated retractions when he called the police did not constitute voluntary surrender according to law. The court ultimately adopted the lawyer's opinion, sentenced Zhang Daqiang to death for intentional homicide, and supported the request for compensation in the incidental civil action. This case was handled by Beijing Henglu Law Firm.Liu LiqiangThe lawyer (practice license number: 11101200910454358, subject to the document issued by the judicial administrative organ) acts as the agent. This case reminds enterprises that in major criminal cases, the depth of reviewing the case files and the grasp of the nature of the case are directly related to the sentencing level. For cases involving the employment risks of the unit, it can be combined with other evidence to determine the responsibility of the unit.Labor arbitration and work-related injury compensation servicesEvaluation.

IV. Practical suggestions and legal basis

The core basis is Article 30 and Article 31 (conviction and double punishment for unit crimes) of the Criminal Law of the People's Republic of China (implemented on October 1, 1997 and amended several times), Article 67 (surrendering oneself to the authorities), and the provisions on defense and plea bargaining in the Criminal Procedure Law of the People's Republic of China (amended on October 26, 2018). Practical suggestions: First, lawyers should sort out the business flow and capital flow and draw a risk map; conduct a comprehensive inspection of high-risk links (procurement, sales, finance, and employment) one by one; promptly correct, refund, or internally handle historical issues; establish reporting and training mechanisms. The physical examination report should specify the risk level and rectification time limit, and, if necessary, introduce a special rectification program for compliance. For issues involving intellectual property and corporate law, they can be addressed in combination with other relevant provisions.Special services and other case-related services.

5. Henglu Law Firm's Reminder

The value of a criminal risk check is not about "buying peace of mind", but about turning invisible red lines into manageable checklists. It is recommended that enterprises avoid two extremes: first, concealing problems and only seeking legal advice when issues are exposed; second, treating the check as a "get-out-of-jail-free card", identifying risks but failing to make corrections. True protection lies in identifying and rectifying problems immediately, leaving a traceable record. For actions that have already crossed the line, the earlier and more complete the voluntary handling, the greater the room for leniency in subsequent proceedings. If necessary, the check results can be translated into actionable internal control plans, and professional criminal compliance teams can be engaged to assist with implementation.

VI. Frequently Asked Questions

Q1: Is it really useful for companies to conduct criminal risk assessments, and can they effectively prevent risks?

A physical examination cannot guarantee that a company will "never be involved in any case", but it can significantly improve the visibility and controllability of risks. Its value lies in centralizing the presentation of hidden dangers scattered across business, finance, and personnel departments, allowing management to have the opportunity to rectify, refund, or cut ties before the case occurs. For those who have been reported or found to have serious problems through self-inspection, a physical examination can help them take the initiative to explain the situation and seek lenient treatment. It does not replace defense, but it is the least costly firewall. It is recommended to regard it as an annual compliance action rather than a temporary remedy.

Q2: When conducting a criminal risk check, what materials and information do companies need to prepare?

Suggested preparation: the company's organizational structure and information on shareholders and actual controllers; financial records, bank statements, and transaction vouchers from the past three to five years; descriptions of core business processes such as procurement, sales, and marketing; employment and compensation policies, rebate and commission systems; resolutions and contracts related to major events (financing, mergers and acquisitions, capital increases); and any received reports, complaints, or regulatory inquiries. The more complete the materials are, the more accurate the lawyer's judgment on corporate crimes, individual responsibilities, and the nature of the funds will be, and the risk map will be more closely aligned with reality.

Q3: How much does it usually cost to hire a lawyer to conduct a criminal risk assessment?

The fees are usually negotiated between law firms and clients based on the size of the enterprise, the complexity of the business, and the scope of the investigation. They are charged on a project-by-project basis or according to the amount of work done, with the specific fees subject to the contract terms. There is no nationwide standard pricing. For businesses with multiple business lines and a large number of historical legacy issues, the fees will increase accordingly; if only a single aspect (such as financial and taxation) is subject to a special audit, the costs will be relatively manageable. It is recommended to require the provision of a service list and a fee breakdown, clarifying the scope of the investigation, the deliverables, and whether follow-up rectification and guidance are included. This should be weighed against the potential risk exposure to determine the investment needed.

Q4: How long does it typically take from initiating a criminal risk assessment to receiving the report?

It depends on the scope of the investigation and the availability of relevant information. A single specialized physical examination often takes one to two weeks; a comprehensive physical examination covering all business lines typically takes three to six weeks, and it will take even longer if it involves a large number of batch checks, interviews, and third-party evidence collection. If the enterprise can provide a complete set of accounting records and process descriptions in a timely manner, the cycle can be significantly shortened. It is recommended to schedule the physical examination before the annual audit or major decisions, leaving time for rectification to avoid the situation of "finding problems but not having time to deal with them".

Q5: I want to conduct a criminal risk assessment for a company. What should I do specifically in the first step?

It is recommended to proceed in four steps: First, led by the legal department or the person in charge, list the three to five risk areas of greatest concern (such as taxation, procurement, and employment); Second, select law firms specializing in criminal compliance, verify the lawyers' practice status through the official website of the judicial administrative authority, and clarify the scope of services and confidentiality clauses; Third, under the guidance of lawyers, collect financial, business, and personnel information, and cooperate with interviews to draw a risk map; Fourth, rectify each item according to the report, keep records, and consolidate the risk assessment into an annual mechanism. If major historical problems are found, an evaluation of proactive handling approaches should be conducted simultaneously.

The above questions and answers are mainly based on the judicial practice in Beijing. There may be differences in the adjudication standards in different regions. It is recommended to consult a professional lawyer based on the specific circumstances of the case.

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. →Criminal defense legal services·Attorney Liu Liqiang·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the 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.