謙聖國際法律事務所

1. What Changed Under Taiwan's 2026 Anti-Fraud Law?

Taiwan's 2026 amendments strengthen the legal response to aggravated fraud by increasing penalties for larger financial losses and encouraging offenders to compensate victims. The revised provisions also address how courts evaluate defendants' conduct, particularly when an offender continues spending excessively without compensating those harmed by the crime.

1.1 When Did the Amendments Take Effect?

The amendments were promulgated on January 21, 2026, and took effect on January 23, 2026. The reform revised several provisions of the Fraud Crime Hazard Prevention Act, including Articles 43, 44, 46, 47, and 50.

Its principal objectives include increasing punishment for high-value fraud, strengthening the responsibility of organized fraud participants, and improving financial recovery for victims. The reform also adjusts certain anti-fraud measures involving financial institutions and other regulated service providers.

➙Importantly, Articles 45, 48, and 49 remain relevant to corporate liability, confiscation, and parole, although these provisions were not newly amended in January 2026.

1.2 Which Fraud Cases Are Covered?

The Fraud Crime Hazard Prevention Act does not impose its enhanced criminal penalties on every allegation of fraud.

Article 43 specifically applies to conduct constituting aggravated fraud under Article 339-4 of Taiwan's Criminal Code when the statutory financial threshold is satisfied. Aggravated fraud may involve impersonating government authorities, committing fraud jointly with three or more persons, publicly disseminating fraudulent information through electronic communications or other media, or using certain technological methods to create false images, sounds, or electronic records.

Ordinary fraud under Criminal Code Article 339 must therefore be distinguished from aggravated fraud and the special high-value fraud offenses. The revised Article 43 focuses on the value of property or financial benefits that victims were induced to deliver, rather than simply the amount of money personally retained by an individual defendant.

💡Determining the applicable amount requires examining the charged fraudulent conduct, the relevant victims, and the evidence supporting the alleged transactions.

2. What Are the New Three-Tier Penalties for High-Value Fraud?

Article 43 establishes three levels of enhanced punishment based on the value of property or financial benefits delivered by victims as a result of aggravated fraud. The revised thresholds are NT$1 million, NT$10 million, and NT$100 million.

2.1 Fraud Involving NT$1 Million or More

Where aggravated fraud causes victims to deliver property or financial benefits worth at least NT$1 million, the prescribed penalty is imprisonment for three to ten years. An additional fine of up to NT$30 million may also be imposed. Before the amendment, the corresponding threshold was NT$5 million. Lowering it to NT$1 million significantly expands the scope of cases potentially subject to the enhanced penalty.

However, the threshold alone is insufficient. The prosecution must also establish the elements of aggravated fraud under the applicable criminal provisions.

2.2 Fraud Involving NT$10 Million or More

Where the value reaches NT$10 million, the prescribed imprisonment increases to five to twelve years. The court may also impose a fine of up to NT$300 million.

This second tier addresses more substantial financial harm and creates a separate sentencing range between the lowest and highest high-value fraud categories. For defendants accused of participating in multiple transactions, determining the legally attributable amount is especially important. The total amount handled by a fraud organization should not automatically be confused with the money personally received by each participant, although personal profit is not the sole criterion for applying Article 43.

2.3 Fraud Involving NT$100 Million or More

Where the value reaches NT$100 million, Article 43 prescribes imprisonment for at least seven years, with a possible additional fine of up to NT$500 million.

Under Taiwan's general criminal sentencing framework, the provision's open-ended term of imprisonment must be interpreted together with the applicable rules governing imprisonment. This is the most severe financial tier under Article 43. The distinction between the three levels can substantially affect sentencing exposure. Courts must still determine whether the statutory offense is established and assess the defendant's responsibility under the relevant legal rules.

3. When Do Additional Aggravated Fraud Penalties Apply?

The 2026 reform also strengthens punishment for certain forms of organized and compound aggravated fraud.

Article 44 addresses specified circumstances involving three or more offenders, additional aggravating methods, cross-border equipment, or the involvement of particular groups of people.

3.1 Using Minors, Elderly Persons, or Foreign Nationals

Under Article 44, Paragraph 1, Subparagraph 3, a person committing aggravated fraud jointly with three or more persons may face an additional one-half increase in the prescribed punishment when the statutory conditions are met.

The provision covers instigating, assisting, exploiting, or jointly committing the offense with a person who is under 18, aged 80 or older, or not a Taiwanese national. Its purpose is to address fraud operations that use vulnerable or foreign participants to distribute criminal tasks and complicate investigations. Article 44 also addresses specified combinations of aggravated fraud methods and certain fraud operations conducted from outside Taiwan.

⚠️However, the involvement of a minor, elderly person, or foreign national does not independently establish the offense. The prosecution must prove the conduct and conditions required by Article 44.

3.2 Criminal Organization Leaders and Corporate Liability

Under Article 44, Paragraph 3, a person who initiates, leads, controls, or directs a criminal organization while committing an offense specified in Paragraph 1 may face imprisonment for five to twelve years and a possible fine of up to NT$300 million.

This provision distinguishes organizational leadership from ordinary participation. The defendant's actual role, authority, instructions, communications, and control over the criminal operation may become important evidence.

Corporate liability is separately addressed under Article 45. Where a representative, agent, employee, or other worker commits a qualifying fraud offense in the performance of business duties, the relevant legal entity or individual may also face statutory fines. An exception may apply where the entity or individual was itself a victim or had fulfilled the relevant supervisory or preventive responsibilities.

➙Businesses should therefore maintain effective financial controls, employee supervision, transaction verification, and fraud prevention procedures‼️

4. Can Fraud Defendants Receive Reduced Sentences Through Compensation?

Victim compensation is a central feature of the 2026 reform.

Articles 46 and 47 provide potential sentencing benefits where qualifying defendants surrender or confess and fully pay the amount agreed upon through mediation or settlement within the statutory period. These benefits are discretionary rather than automatic.

4.1 Voluntary Surrender and the Six-Month Compensation Deadline

Under Article 46, a defendant who voluntarily surrenders after committing a qualifying fraud offense and pays the entire agreed mediation or settlement amount within six months from the date of surrender may receive a reduced sentence or exemption from punishment. The six-month period is therefore an important consideration when planning a legally appropriate settlement.

For example, if the defendant reaches an agreement with a victim but fails to pay the full agreed amount within the required period, the specific sentencing benefit under Article 46 may not be available. Where the defendant also assists in identifying fraud organization leaders or recovering the relevant property under the additional statutory conditions, further sentencing relief may be possible.

Nevertheless, voluntary surrender, compensation, and cooperation must be evaluated according to the actual requirements of the provision.

4.2 Confession, Settlement, and Judicial Discretion

Article 47 provides a separate route for potential sentence reduction.

A defendant who confesses during the investigation and throughout successive trial proceedings, and fully pays the agreed mediation or settlement amount within six months from the first confession to the prosecutor, may qualify for a reduced sentence. The timing of the first confession is therefore important.

The amendment also changes the statutory reduction from mandatory to discretionary. Even when the requirements are satisfied, the court must still decide whether a reduction is appropriate. Additional relief may be available where the defendant's cooperation results in the identification of fraud organization leaders or the recovery of property under the specified conditions. A settlement does not automatically eliminate criminal liability, and payment alone does not guarantee a lighter sentence.

🧑🏻‍⚖️Defendants should also understand that confession may have significant evidentiary consequences. Whether to confess, contest the allegations, or pursue settlement should be assessed according to the evidence and the individual's legal position.

5. Can Luxury Spending Increase a Fraud Sentence?

Yes. Under the amended Article 50, Paragraph 2, courts must pay particular attention to specified forms of excessive spending when determining punishment before the offender has fully compensated the victim or paid the agreed settlement amount.

The provision does not create a general prohibition against ordinary personal spending. Instead, it makes extravagant financial conduct an express sentencing consideration.

5.1 What Counts as Extravagant Spending?

Article 50 identifies six categories of conduct that may be relevant to sentencing.

These include:

• purchasing, leasing, or using goods and services beyond ordinary living standards
• using unusually expensive transportation
• making excessive investments
• spending at high-consumption establishments
• giving or lending unusually valuable property
• maintaining monthly living expenses substantially above ordinary standards

Examples may include purchasing luxury vehicles, regularly spending large amounts on high-end entertainment, or making expensive discretionary investments while leaving fraud victims uncompensated.

➙However, the statute does not establish one fixed monetary threshold for every form of spending. The court must assess the circumstances and determine whether the conduct exceeds ordinary living standards.

5.2 How Courts Evaluate Spending Before Compensation

The anti-luxury provision is intended to prevent offenders from prioritizing extravagant personal consumption while failing to compensate victims.

For sentencing purposes, the court may consider the offender's financial conduct together with the nature of the offense, the extent of the harm, the defendant's responsibility, and other relevant circumstances. Necessary expenses for food, housing, healthcare, employment, and ordinary transportation are not automatically prohibited.

Likewise, an expensive purchase does not independently establish guilt or create a separate fraud offense under Article 50. The provision concerns sentencing after the relevant criminal liability has been established. For defendants pursuing compensation or settlement, financial records and the circumstances surrounding significant expenditures may become relevant during sentencing.

6. How Do Confiscation and Parole Rules Affect Fraud Cases?

In addition to imprisonment and fines, Taiwan's Fraud Crime Hazard Prevention Act contains special provisions concerning confiscation and parole. These rules can substantially affect the financial and practical consequences of a fraud conviction. Although Articles 48 and 49 were not newly amended in January 2026, they remain important parts of the statutory framework.

6.1 Confiscation of Property and Unlawful Financial Benefits

Under Article 48, property used to commit a qualifying fraud offense is subject to confiscation regardless of whether it belongs to the offender. The provision also addresses other property or financial benefits controlled by the offender where sufficient facts establish that they originated from other unlawful conduct.

For example, electronic devices, financial instruments, or other property connected to the commission of fraud may raise confiscation issues. However, confiscation must still be evaluated under the applicable statutory requirements, including the relationship between the property and the offense. Property ownership, the nature of the asset, its use in the alleged crime, and the evidence of unlawful origin may all be relevant.

⚠️Confiscation should also be distinguished from compensation paid directly to victims. Recovering criminal assets does not necessarily mean that every victim has already received full reimbursement.

6.2 Higher Parole Thresholds and Repeat Offenders

Article 49 imposes stricter parole requirements for qualifying fraud offenders.

• A person serving a fixed-term prison sentence may become eligible for parole after serving more than two-thirds of the sentence, provided the other statutory conditions are satisfied.
• For repeat offenders, the threshold increases to more than three-quarters.
• Parole is unavailable where fewer than six months of imprisonment have been served.
• Certain repeat fraud offenders are also excluded from parole when they commit another qualifying fraud offense within the period and circumstances specified by Article 49.

These restrictions can substantially increase the period a convicted person must serve before parole becomes possible. However, meeting the minimum time requirement does not guarantee release. Parole remains subject to the applicable assessment and approval procedures. For juvenile offenders, the relevant provisions of Taiwan's Juvenile Justice Act  must also be considered.

7. How Does the Reform Affect Defendants, Victims, and Businesses?

The revised fraud framework affects more than sentencing alone. It changes how defendants assess criminal exposure, how victims approach compensation, and how businesses manage fraud-related legal risks.

7.1 Criminal Defense and Victim Compensation

For defendants, one of the first questions is whether the allegations involve ordinary fraud, aggravated fraud, or high-value fraud under Article 43.

The prosecution must establish the required criminal conduct, mental elements, and financial thresholds. Where multiple individuals are involved, their actual roles should be examined rather than assuming every participant had identical knowledge, authority, or involvement. The timing of the offense is equally important. Under Criminal Code Article 2, changes in criminal law generally require consideration of the law applicable at the time of conduct and whether a later law is more favorable to the defendant.

More severe provisions introduced in 2026 should not automatically be applied retroactively to earlier conduct. For victims, the revised compensation rules may encourage earlier mediation and settlement. Nevertheless, an agreement is valuable only when its terms are appropriate and payment can actually be obtained. Victims may also consider the relevant criminal and civil procedures for seeking financial recovery.

7.2 Corporate Compliance and Legal Assistance

Businesses face potential risks when fraudulent conduct occurs through employees, representatives, financial accounts, or business operations.

Internal controls should address suspicious transactions, employee access to financial resources, verification of payment instructions, and procedures for reporting suspected fraud. Maintaining appropriate supervisory and preventive measures may also be important when evaluating liability under Article 45.

Chien Sheng International Law Firm provides criminal defense and related legal services in Taiwan, with offices in Taipei, Taoyuan, and Kaohsiung.

The firm's attorneys assist clients in examining fraud allegations, financial transaction records, criminal intent, the applicable sentencing provisions, and potential settlement strategies. Legal representation may also involve evaluating whether Article 43 applies, whether the prosecution has established the alleged financial amount, and whether any statutory sentence-reduction provisions are available.

🧑🏻‍⚖️For victims and businesses, legal assistance may focus on financial recovery, evidence preservation, dispute resolution, and risk management. The appropriate legal strategy depends on the specific facts and available evidence.

8. Frequently Asked Questions (FAQ)

The amendments were promulgated on January 21, 2026, and took effect on January 23, 2026. They introduced major changes to high-value fraud penalties and compensation-related sentencing provisions.

Under Article 43, aggravated fraud involving qualifying property or financial benefits of at least NT$1 million carries a prescribed imprisonment range of three to ten years. The provision does not automatically apply to every ordinary fraud case involving that amount.

Where the requirements of Article 43 are satisfied and the relevant value reaches NT$10 million, the prescribed sentence is five to twelve years of imprisonment, with a possible fine of up to NT$300 million.

Qualifying aggravated fraud involving at least NT$100 million carries imprisonment for at least seven years, with a possible fine of up to NT$500 million, subject to the applicable statutory sentencing rules.

Not automatically. Criminal Code Article 2 governs the application of criminal laws when legislation changes. Courts must assess the relevant versions of the law and apply the appropriate rules concerning the law more favorable to the defendant.

Potentially. Articles 46 and 47 provide discretionary sentencing benefits when the relevant requirements are satisfied, including qualifying surrender or confession and full payment of an agreed settlement or mediation amount within six months.

Partial payment generally does not satisfy the specific requirement to pay the entire agreed mediation or settlement amount under Articles 46 or 47. Nevertheless, compensation efforts may remain relevant to other sentencing considerations.

Yes. Article 50 directs courts to pay particular attention to extravagant spending before full compensation or settlement payment. Ordinary necessary living expenses are not automatically prohibited.

The special rules under Article 49 generally require more than two-thirds of a fixed-term sentence, or more than three-quarters for repeat offenders, together with the other statutory conditions. Certain repeat offenders may be ineligible for parole.

Potentially. Article 45 provides for liability involving qualifying fraud committed during business duties, subject to statutory exceptions concerning victim status and appropriate supervision or prevention.

9. Conclusion

Taiwan's 2026 amendments to the Fraud Crime Hazard Prevention Act represent a major development in the country's approach to aggravated fraud.

The revised Article 43 introduces three penalty levels beginning at NT$1 million, NT$10 million, and NT$100 million, substantially increasing the criminal consequences of qualifying high-value fraud. The reform also strengthens provisions concerning organized fraud and creates greater incentives for defendants to compensate victims through timely surrender, confession, mediation, or settlement. Courts must pay particular attention to extravagant spending before victims have been fully compensated, while existing confiscation and parole rules remain important considerations in fraud proceedings.

Nevertheless, criminal responsibility cannot be determined solely by the total amount associated with a fraud investigation or by a defendant's alleged connection to a larger criminal organization. The applicable offense, individual conduct, financial evidence, criminal intent, and timing of the alleged acts must all be carefully examined.

🧑🏻‍⚖️Chien Sheng International Law Firm assists clients with fraud investigations, aggravated fraud allegations, victim compensation disputes, criminal defense, and related legal matters in Taiwan.Understanding the applicable statutory provisions and preserving relevant evidence at an early stage can be essential to protecting legal rights.

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