The contract fraud between the Gacheng municipality and a special company has given rise to considerable controversy, and the experts believe that it is essentially an economic dispute rather than a fraud.

On 20 October, the Gaiguang City Public Security Bureau of Gansu province issued a message that “the initiatives to optimize the business environment will continue to deepen... and to create a secure and stable, fair and efficient rule of law business environment for the high-quality economic and social development of the Kashuwan province”. The blogger adds:

However, at almost the same time, a car manufacturing enterprise, introduced by the head of the city of Garang himself, was convicted of “contract fraud” and is being tried in court.

The “fraud enterprise” had been recognized by the Government and had been given a large gift. Microblogging

The case was highly controversial: eight years ago, the Secretary of the Gaeguang City Council and the Mayor went to Shanghai to solicit a business and signed a cooperation agreement. The following year, the first full-car of the project was taken off the production line in a round of applause and flashlights, and the Provincial Standing Committee was present to congratulate the media for calling it “nineteen grand gifts project”.

This “broadcasting story”, which was written in the history of local development, is now rewritten in another way — the mayor, Wang Qian, who went to the country to sign the contract, has been imprisoned, while the entrepreneurs and employees who were attracted by the Government's favourable conditions at the time have waited for a final decision on fate in long detention and trial.

01

Local leadership won “Dreams in the Automobile Industry”

In the second half of 2016, the then Secretary of the Gakkagun City Council, Liu Peng, Mayor Wang Wang Zheng, and others, representing the City Council and the City Government, travelled to Shanghai to work with Shanghai Flying and Industrial Group Limited (hereinafter referred to as “Flying and Group”).

On 10 November of that year, Wang Qian signed a Cooperation Agreement for the Investment of the Project for the Development and Manufacture of 100,000 Multi-Function Whole Vehicles at the Gai Guan City, Gansu Province, on behalf of the Gai Guan Municipality, with the company Liang Zheng Company Limited for the Construction of a Gas and Leng Source Motors, a subsidiary of the Flying & Group (hereinafter referred to as “Ling & Ling Company”) and the Shanghai Zhu Zi Enterprise Development Company Ltd. (hereinafter referred to as “Ling Zi” ).

Under the Letter of Agreement, the project plans to build the main facilities of the production plant, the main assembly workshop, the coating workshop, the welding workshop, the flushing workshop and the establishment of the Centre for Research and Development of Vehicle Applications. The Gaguwan municipality has committed to financing the project company for 500 million yuan for a five-year period, with interest to be borne by the Government.

On 14 November 2016, the project company, Garanga Special Motor Manufacturing Co. Ltd. (hereinafter referred to as “the Special Company”) was formally established. The group manager, Zheng Rey, named Shavelin, as legal representative.

Garrett Special. Ichioka Ying-chul!

On 29 December of the same year, the Gachong municipality allocated 50 million yuan to a special company for project construction through the Garang City Heating Company (hereinafter referred to as “the Hot Company”) and the Garang City Economic and Technology Development Zone Development Company Ltd. (hereinafter referred to as “the Establishment Company”).

On 23 January and 1 March 2017, the Government again allocated funds totalling $150 million through two companies. The Government has invested a cumulative sum of $200 million in a special company, all of which is earmarked for the construction of the plant by flying and groups.

However, according to Zheng Lei Fei, the court in the trial of “contract fraud”, the pre-existing policy commitment and cooperation was not renewed after the change of the main leadership of the city. On 26 June 2017, the Government of the city was re-signed by the company that opened the company, on behalf of the municipality, with the Flying Clan Group, Linggen Corporation and the Mau Xi Company. The Supplementary Agreement on Cooperation in the Investment of the Project for the Development and Manufacture of 100,000 Multifunctional Whole Cars (hereinafter referred to as the Supplementary Agreement) was signed between the company and the company.

The Supplementary Agreement states that the municipality of Kaguang, after entering the stock of 200 million yuan, does not participate in the business and does not assume the risk of doing business; After five years without participating in the bonus, a special company is required to pay the Government a bonus at the 20 per cent rate of the benchmark interest rate on short-term loans.

In July of the same year, a special company applied for 300 million yuan in fixed-asset loans from the Garsu Bank, the Kassuo Bank, and the East Road Branch. In its response, the Department of Bank Risk and Credit Management requires that the actual availability of project capital funds and the sources of financing for prior construction be verified, that no funds may be borrowed from government platform companies or other enterprises as capital funds of not less than $255 million and that loans be made only after they have been fully available.

On 28 July, a special company signed a 300 million-dollar fixed-asset loan contract with Gansu Bank to clarify that the loan was for project construction and equipment procurement. The heating company guarantees the loan. To meet the terms of the loan, Ling and Lin and Lin Xi transferred $90 million and $20 million respectively to a special company. On the same day, the bank issued 300 million yuan in loans, which were frozen and the use of which was subject to approval by the bank and a special monitoring group established by the Government (the group is headed by the person responsible for the supervision).

On 16 October, a special company officially closed its first car and was closed to the City Museum. Local media claim that the project is a “new engine” for the manufacturing of equipment and the transformation of industrial structures in Kaguang, and that it is planned to produce three broad types of vehicles: multi-purpose vehicles, including garbage cleaners, cold-chain logistics vehicles, 37 items, heavy trucks, 8 items for trailers, dumpers, etc., and light trucks, including 2 items for box-sized logistics vehicles.

“The first whole vehicle exit and entry collection was a major achievement in the collection of money and project construction by Kawan. The then-City Secretary Wang Wang Zheng publicly stated that this marked the new stage in the manufacturing of Kawan equipment and was a gradual outcome of local supply-side reforms.

Since then, a special company has entered a relatively stable period. Since the first car was taken off the line, a total of 1,445 vehicles have been produced and 1365 have been sold. However, in March 2019, the municipality of Garang changed its mind and ordered the second Supplementary Agreement to be signed in the opening area, changing the original investment of $200 million to $175 million (a special company had repaid $25 million in January 2018). The agreement also provided that a special company would be required to cover the full interest on the loan and the $300 million bank loan.

Since then, the municipality of Kaguang has unilaterally changed the terms of cooperation and has pressured enterprises twice to sign complementary agreements to its detriment by means of multiple means. Since its establishment, a special company has paid interest to the Government and banks in the amount of $128.62 million and has repaid the principal of the Kasawan-Kaka-Kawa-Kawa-Kawa-Kawa-Kaka-Kaka-Kaka-Kawa-Kaka-Kaka-Kawa-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kawa-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kawa-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kawa-Kaka-Kaka-Kama-Kama-Kama-Kawa-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kana-Kama-Kama-Kama-Kama-Kama-Kama-Kama-Kama-Kama-Kama-Kama-Kama-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-Kaka-

The house leaks, which is raining all night. The three-year-long epidemic control followed the financial crisis of companies as a result of the “failure” of government. The fate of a special company has since become even more precarious.

02

From “Nineteen Grand Gift Project” to “Fraud Groups”

The business is struggling with the heavy burden of money. The “car-building-base project” that was ambitious and expected to serve as a model for local industrial transformation, had to be supported by a combination of high interest and policy changes, after repeated failures in policy commitments and changes in financing conditions, until it was on the verge of collapse.

“Even so, the enterprise is trying to move forward. During the trial, Jung Giang recalled that they were constantly responding to the Government's demands and to social concerns, and that the project team maintained production lines around the clock and was trying to find new partners and sources of funding. As the company struggled to keep it alive, the three-year outbreak came on the rise.

“This was almost a fatal blow to a heavy, light-card production enterprise, which has a major market for road transport. He said. Over the years, logistics have stalled, orders have declined sharply and entire production lines have been disrupted.

Faced with the plight of the business, the Gawan municipality has neither honoured its earlier pledges of support nor extended its help. Instead, it began to fight a lot of former business vendors in a near “correctional” stance.

Since 2020, criminal measures have been in operation: first, the investigation of the business director was initiated by a “contract fraud” case, then the investigation was reopened by a “tax evasion” case, which was summoned repeatedly by the same person. All cases ended up without a valid charge, but they resulted in the company being objectively hurt and the business being paralysed.

A special company site is long-stored. Ichioka Ying-chul!

After the Prosecutor's Office issued a decision not to prosecute a special company for contract fraud in 2022, for lack of substantial evidence, the police reopened the case for “contract fraud” in 2024, issued a warrant for arrest and prosecuted a small shareholder (JUNG Korea) and an employee (Saverine).

A “broadcasting story”, originally written in the history of local development, has been slid into the abyss. Businessers are in a state of disquiet and ask: If this is so-called “contract fraud”, what should be the explanation for the agreement and policy commitments signed by the City Secretary, Mayor himself and himself in Shanghai in 2016? Was it not a fraud to commit to a failed government after the government offered to invite investment and the project landed, to the extent that the defendant was crying in court against the government for “cross-the- River-Breaking” and “squaw-dog-squawking” *?

From the time of project development to its launch, the Government had established a large project team to intervene throughout the process — each with a signature, stamp and a chain of top to lower level approvals. They had no idea of the progress of the project. If there was a fraud, wouldn't they all be deaf and blind? Is the government leadership involved in the project a crime of malfeasance and is it easy to get rid of it without having to open a case or internal investigation?

Among these leaders, the Public Prosecutor ' s Office also accused Zheng and Thong of bribing one of the accused for having been arrested for bribery and abuse of authority. The accused Zheng Rai Fei Court of Appeal charged that it was the original court secretary, Liu Peng, who had actually decided to solicit money. Zheng Lai Fei recalled that the bribery was a false one and that Zheng and Tong complained to him after completing his statement in the case: “The Disciplinary Commission arrested him without a signed signature, and the evidence was totally inadequate and convicted on the record”.

Zheng Lai Fei said that it was during the Rambo conference that the incident of “bribery” occurred, and that it was him at the scene of Kaji's detention, not Cheng Sun.

We do not know, according to the relatives of one of the accused, whether the memories are true or credible, but “it is not possible that the Government of Garang, by abusing its authority, would fail to solicit funds and would be able to dismiss the claim of the Crown for other mistakes elsewhere, but it is worth our asking. The blogger adds:

As can be seen from past media reports, in October 2017, a special company officially closed its first car, and the Standing Committee of Gansu Province visited Ka-soo, where local media covered the matter with “nineteen grand gifts”, shouting “Smart, my praise”, which was once used as a local performance pole. Even in 2021, the Kaguang Province Industrial Park Network was praised for the project as “a model for the upgrading of the Kaguang Industrial Park”.

Today, the old “model project” has been redefined as a “frauder group”. On 13 January 2025, the Gaizang City Public Prosecutor ' s Office filed a public complaint, finding that the case had caused significant damage to the Government of Kaizang and had caused great harm, and consequently seriously affected the heating of 300,000 Jaizhang.

The first truck to drop off was still at the Gaiwan City Museum, but moved from the center of the stage to outside the museum. Ichioka Ying-chul!

03

Expert in criminal law: non-incrimination, essentially economic disputes

The Gaizang City District Prosecutor ' s Office charged that the accused Zheng Giang and Zheng Rai Fei, Zheng Soon Tong and Zheng Mengk had planned to obtain financing through government solicitation projects to make up for the long-term losses and accumulated debts during their operations and groups.

In November 2016, the Flying and Group, aware that it did not have the required qualifications for the production of specialized vehicles under the National Automotive Industry Development Policy, lured the municipality of Kawanguang into making it a major offer under the name “Investment of $2 billion to build a research and development base for 100,000 multi-purpose whole-cars a year”. On 10 November, the Flying and Consortium signed a cooperation agreement with the Kajiang municipality through a capital and a Shanghai training company, which agreed that the Government would finance the project with $500 million and that interest would be borne by the Government.

Shortly after, the Flying and Gang formed a “special company” in Kaguang's book of interest, with Shavelyn as the legal representative (later changed to Zheng Giang). The Government has allocated 200 million yuan in funds through heating companies and through start-ups. The prosecution claims that a special company subsequently fraudulently filed a project approval report and obtained government confidence by partially performing and making project false statements.

In June 2017, the company again applied for financing in the event that the funds were not fully utilized. The Government subsequently signed a supplementary agreement to convert $200 million into “inventory” and to assist businesses in lending $300 million from banks to provide guarantees from heat companies. The prosecution alleges that, after the loan was made, $242 million was transferred to flying and group-related accounts, of which $3.66 million was used to manipulate the securities market. The project was eventually completed in the mains workshop, and the work was stalled for a long time.

The firm was identified as having assets of approximately $490 million and liabilities of $540 million, and the project actually invested only $116 million. As of the time of the incident, only $60 million had been repaid from the bank, resulting in a loss of approximately $240 million.

At the same time, the prosecution also charged that between 2018 and 2020, a special company had fraudulently filed or failed to declare tax, and that it had accumulated tax evasion of $1.878 million, or approximately 30 per cent of the taxable amount, which was subsequently paid back in 2023.

The allegations described above define the original “inventory project” as a well-planned financial fraud: project qualification fraud, contract performance fraud, and the diversion of loan funds, thereby defrauding the trust and support of the Government and financial institutions.

In this case, characterized as “contract fraud”, the defence commissioned six experts in criminal cases, namely Professor Tyo-Kow, Professor Ta Doo-chung of Criminal Law, Professor Leung of the Faculty of Law of the University of Qinghua, Professor Liu of the Chandian Lecture at the University of Political Science and Law of China, Professor Ino of the Criminal Justice Academy and Professor Huang of the Faculty of Law of Tianjin University, to conduct a systematic demonstration of whether the conduct of Zheng Gi-Hong Han and Sha Wei Lian in the case constituted a crime of contract fraud.

The Gaizang City Public Security Bureau was sent to the police unit. Ichioka Ying-chul!

After a study, the experts agreed that the fundamental nature of the case was not fraud, but rather an economic dispute arising from policy changes and market contraction. So Zheng Giang Han and Saviorian are not enough to be a contractual fraud. The main reasons are as follows:

I. No intentional unlawful occupation. The fact that Zheng Giang, Sha Wei Lian and related enterprises have no illegal occupation in their contract, performance and performance is the underlying reason why the offence of contract fraud cannot be established. “Fraud” in the criminal law sense requires that the perpetrator, when signing or performing a contract, has a subjective purpose of illegal possession, and that, according to available evidence, both flying and grouping and a special company have actual investment, performance and operation.

Following the establishment of a special company, a major plant was built, such as a major assembly, coating, welding, which paid for a large amount of equipment purchased and some of the loans made to the Government and the bank were repaid as contracted. The total assets of the company are essentially the same as the amount of government investment, and the funds are actually used for project construction without flight or concealment. The expert thus concluded that there was no unlawful possession and that there was no subjective element of contractual fraud.

II. There is no objective deception. While the Group does engage in over-broad propaganda, packaging qualifications and so on at the level of solicitation, this is a widespread means of commercial propaganda or investment glorification, rather than deception in the criminal law sense.

In investment negotiations and financing, the fact that a company boasts its own strength and dilutes its risks is a common practice in the private sphere, essentially a “price-for-money” process in commercial negotiations does not constitute a criminal fraud. Experts believe that even if the business had an exaggerated qualification, it could only trigger civil disputes and not constitute a criminal offence.

III. On compliance capacity and actual implementation. A special company not only has the technical and human base for car manufacturing, but is also actively engaged in the contract: it invests government funds in building and equipment, and the research and development team has been expanded from 60 to over 300; (b) Payment for multiple purchases of equipment; Part of the principal and interest payments were made to the Government and banks, and tax reimbursements were made.

The experts believe that these facts indicate that the enterprise has always been aiming at compliance and is objectively advancing the project. Even if the late-stage cut-off from the market and the epidemic were to occur, it would not be equivalent to fraud.

IV. On the boundaries between “civil disputes” and “criminal offences”. The expert refers to the Supreme People ' s Court ' s Guidance on Optimizing the Rule of Law Environment for Private Economic Development, which states that the case is a dispute over financing and contract performance and that the civil remedies have not been exhausted.

Garang has a right to claim through civil proceedings, including the company that opened the company, the Gansu Bank, etc., and it is not appropriate to intervene by criminal means in economic disputes. Criminal law should remain modest and prevent “penalized debt”, which would seriously undermine the legal security of the private sector.

On the distinction between “responsibility for decision-making and personal responsibility”. Jung Giang, Saviorian, who are executive directors, legal representatives and financial officers respectively, do not have substantive authority over the company ' s operations. A special company is a fully-owned subsidiary of the group, whose major decisions are decided collectively by the group board, while Savierian is not in the shares and performs financial work only.

Therefore, the corporate behavioral machinery cannot be equated with the individual will. Even if the company had management deficiencies, it should not be held criminally responsible by both individuals alone.

Sheilain is currently in custody here. Interviewees

VI. Missing in relation to “victim perception error”. The offence of contract fraud was established on the premise that “the victim disposes of property for having been deceived into a mistake of perception”. In the present case, however, the lending decision of the Gacheng municipality and its subsidiary financing platform was based on the essence of the decision of the then Mayor Wang Qian, who had full knowledge of the qualifications and the project and had signed the Supplementary Agreement in person.

Thus, the Government does not create a misperception by being deceived, but rather takes the initiative to make decisions. The heating companies, the companies that operate them and the Gansu Bank are all government-authorized, and the lending is essentially a policy act, not a fraudulent act. Thus, “swindle-disposal” that is not in conformity with the fraud offence constitutes a chain.

In conclusion, the six criminal law experts unanimously argued that the conduct of Zheng Giang Han and Sha Wei Lian was incompatible with the constituent elements of article 224 of the Criminal Code, which deals with the offence of contract fraud, and that the case was one of civil and commercial disputes and should not be criminalized.

The defence considered that tax evasion was also insufficient. First, there is no subjective intention of tax evasion by a special company. Companies have been reporting tax on a monthly basis since their establishment until the end of 2021, and were unable to pay tax due to business difficulties in 2022, but they have nevertheless taken the initiative to communicate with the tax authorities to check the tax. The case was followed by a positive change in the attitude of the company ' s family, who raised their own funds to pay the tax arrears.

In terms of liability, the taxpayer is the company itself, and the financial officer, Shavelin, performs only the duty of communication and assistance, and does not act as a instigator or a facilitator. The breakdown of a special company ' s accounts was caused by its internal mismanagement, and the group had urged the restructuring as early as 2019, which demonstrated its independence from its financial operations and was not related to subjective tax evasion by the group or individuals.

In procedure, the company, after receiving the tax penalty, applies for a hearing, a statement and a written statement of submission to the tax recognition data, without resistance or concealment, in accordance with the law.

Thus, the failure of a special company to pay taxes is a passive result of operational difficulties, which do not imply the concealment of income, false declarations, or active repayment, cooperation and investigation, and do not constitute a crime of tax evasion under the law.

04

Who's the victim of the fraud?

In early September 2025, the author was present at the trial. In 2022, the group and a special company belonging to it were in a difficult position to pay interest on schedule to the company, the heating company and Gansu Bank because of the tight financial chain that had been strained in the car business. A special company has repeatedly promised in writing to pay back the amounts.

“The opening of a company, the heating company and the Gansu Bank have initiated civil proceedings to fulfil their obligation to pay back. The government is not ready to criminalize economic disputes. The blogger adds:

Indeed, the starting point of the case dates back to the political changes that occurred a few years ago. In 2020, Wang Zhen, the former Secretary of the Gacheng City Council, fell. The Intermediate Court of Lanzhou found that Wang Qian had signed the Investment Cooperation Agreement with Shanghai and Ling-jin Corporation without the necessary legal procedure during his tenure as Mayor and Secretary of the City Court of Garang, and instructed Ka Zheng to conclude a supplementary agreement with the relevant enterprises and a loan interest agreement with the company concerned, which agreed to repay interest on the loan by the company in its place, and also to return the land of a special company to the Government for concession. The Court held that the act was contrary to the legal prohibitions and caused the State to lose more than $6.4 million.

The Ranzhou Central Court, which was sentenced to 18 years ' imprisonment and a fine of $1.2 million, was sentenced to three offences, namely embezzlement, bribery and abuse of authority. Wang Zheng contested the appeal, but the results of the second hearing have not yet been made public.

According to the source, Wang Qian is serving his sentence and continues to complain that “the special company project is a collective decision of the municipality, not an individual conspiracy with the enterprise”.

It is not unusual for Banco Gansu, the main source of project funding, to feel that it was being deceived. It maintained that the circumstances of the loans were clear and clear.

Gansu Bank, Garang Bank, Ichioka Ying-chul! In July 2017, the Bank issued a fixed asset loan of $300 million to a special company at an annual rate of 6.9 per cent, which was due to expire in July 2022 and was subsequently extended by mutual agreement until July

1. Loans are in place, mortgages are secured

• the plant land and machinery are registered for mortgage, and the four shareholders have held shares in the establishment of pledge, in addition to joint and several guarantee contracts between the Flying and Group, Leng-in Corporation, Luang-Teng Corporation and several natural persons.

The Gansu Bank stressed that this was a standard letter of contract, certificate and guarantee and that the loan was granted and used in accordance with the procedure established by law. However, a special company failed to pay its principals on time and the guarantor failed to perform its obligations. The bank then instituted civil action, requesting the court to order repayment of the principal amounting to approximately $262 million and recognizing the right to a mortgage, the pledge and the priority payment. In other words, the Gansu Bank, in its Karo-Kaka branch, does not consider itself a victim of fraud, but merely a party to an economic dispute. However, the Kaizumi court considered that a special company and its legal representatives, Sha Weilian, Jung Giang, Zheng Rey Fei, had been opened for investigation by the public security authorities for suspected contract fraud offences, that the dispute in the case might be related to economic crimes and that it was not appropriate to continue the proceedings, and that it should be decided to dismiss the complaint by the Kansaka Gacheng branch and to transfer the relevant material to the public security organ, which could then claim it after the criminal case had been completed. So, who is the victim of the fraud? It is clear that the Government of Garang considers it the most serious victim, as it guarantees the borrowing of a special company, which is required to pay the bank's Gai Sun branch in order to pay for a special company that cannot repay it. “The Government, which does not want to pay back money and does not want to take responsibility, has taken the criminal knife. “At the court, Beijing lawyer Zhang Dong pointed out that the municipality of Kajiang was involved in a criminal dispute and that heated companies were being facilitated to escape the guarantee. After additional investigation, the case is expected to be heard again in mid-month this month.

Garang City District Court. Ichioka Ying-chul! Moreover, counsel generally believes that the City Court of Garang City has no jurisdiction in the case. Several defence counsel have raised jurisdictional objections, but the Court has not responded. Until the first instance hearing, the defence again raised procedural issues, while the presiding judge expressed the need to respond in a uniform manner after the trial, to press ahead with the trial, and to deliberately ignore the trial itself could be contrary to the law. According to one of the accused ' s relatives, the case, under article 21 of the Code of Criminal Procedure, should be considered by the Intermediate People ' s Court in a very large and complex manner, rather than at the lower level. “Is it possible that the other party in this case, with whom the Kaguang municipality was inextricably linked, even when the government was involved from top to bottom when the money was sought, could a fair trial be held before the Basic Court of Kaguang? Should the Kaguang District Court avoid the suspicion? The blogger adds: The relatives of the accused indicated that an article published in the People's Court newspaper in recent days might also contain elements that profoundly influenced the outcome of the trial

• the Vice-President of the Supreme People's Court stated that the elements of a crime must not be deliberately misinterpreted or broadened to the detriment of the accused for the purpose of criminal responsibility. “The question now is: will the local courts take this guidance seriously and will our rule of law be fully reflected in this case? I am not a writer.

Second trial of the Hong Kong merchant case, which was sentenced to one year's imprisonment after 884 days: Public Security is still investigating the case. 34.8 million cash denied to the bank for the villa, the luxury of Hu Guoqiang, the Governor of Xinjiang, and the anti-corruption dilemma Secret book of Changde's “Pro-Fullaire” Project Sakashi has taken 165 million, and many former senior officials have appeared to work with the fraudster The Beijing DUI has no qualifications for irregularity and the quality of the exhale and blood tests is very different

The original information

Original title: From “Nineteen Grand Offering Works” to “Contract Fraud”: The Frestrial Story of the Garang Recruitment Project

Source: Micro-Intelligence Public < Frog Beep >