On September 22, a piece of news released by the Discipline Inspection and Supervision Commission of Jiangsu Province shocked the police: Gao Shan, the deputy mayor of Nantong City and director of the Municipal Public Security Bureau, was suspected of serious violations of discipline and law. He is currently under disciplinary review and supervision investigation by the Discipline Inspection and Supervision Commission of Jiangsu Province.
Also on that day, the case of Guan Wenqi, the former chairman of the Beijing Health Industry Association, was separated and heard in the Haimen District People’s Court of Nantong. After 11 days of trial, the court announced an adjournment.
It is worth noting that this was the largest criminal case in which Gao Shan personally instructed a “full-chain crackdown” during his tenure as the director of the Nantong Municipal Public Security Bureau. The local police organized more than 450 police officers from Hai’an and Haimen to travel to Beijing and Hebei to conduct cross-provincial arrests, arresting more than 720 suspects and freezing more than 70 million yuan of funds involved in Guan Wenqi’s company.
However, the case faced huge controversy during the trial because the products sold by Guan Wenqi and his company were not “fake health products” as reported by the public security, but regular medicines and foods, including those with national drug approval numbers, and they also had a complete return and refund mechanism. Therefore, the defense lawyers all believed that Guan Wenqi and his company’s employees did not constitute the crime of fraud as alleged by the prosecution.
What is even more puzzling is that, according to relevant sources, the whole case claimed to have “100,000 victims”, but the case originated from a retired police officer in Nantong who reported the case to his former unit, and then his former colleagues accepted and filed the case. After the police seized more than 70 million yuan in funds, not a single victim appeared in court to request compensation.
In court, many defense lawyers questioned the Nantong police’s “fishing law enforcement” and “profit-seeking law enforcement”, and suggested that the case be transferred out of Nantong for trial in order to reflect judicial fairness and justice.
Gao Shan demanded a “full-chain crackdown”, and cross-provincial arrests froze 70 million yuan in funds
On November 22, 2021, the Nantong police reported a “major telecommunications network fraud case”, stating that on July 6 of that year, the Nantong Municipal Public Security Bureau organized more than 450 police officers to conduct cross-provincial arrests in Beijing and Baoding, arresting more than 720 suspects on the spot and freezing more than 70 million yuan in funds involved.
Gao Shan, the then deputy mayor of Nantong City and director of the Municipal Public Security Bureau, had requested that the city and county-level criminal investigation departments conduct in-depth research and implement a full-chain crackdown. The Criminal Investigation Detachment of the Municipal Public Security Bureau took the lead in coordinating relevant police departments and public security organs in Hai’an, Haimen and other places to form a special case team and jointly carry out special case attacks.
The police report stated: “This case is the largest telecommunications network fraud case that the Nantong Public Security has solved so far in terms of single organization degree, number of police officers involved, number of suspects involved, number of victims involved, and amount of money involved.”
The company that was arrested across provinces was Zhongfu Internet Hospital of Guan Wenqi, the former chairman of the Beijing Health Industry Association, and its branch in Baoding. In addition to the 70 million yuan in funds being frozen, the police escorted 157 employees of the company back to Nantong.
After that, the procuratorate divided the case into two cases and prosecuted a total of 109 people in Hai’an City and Haimen District of Nantong on suspicion of fraud.
Report of Nantong Public Security
In the whole case, “100,000 victims” only one retired police officer reported the case, which was questioned as “fishing law enforcement”
In the official report, the case originally came from a report by “Uncle Cao” from Hai’an.
In the trial in Haimen, the defense lawyers pointed out that, after investigation, the real identity of “Uncle Cao” was a police officer from the Hai’an Public Security Bureau of Nantong, and he claimed “currently unemployed” when reporting the case.
In the police report, the real identity of “Uncle Cao” who reported the case is a police officer from the Hai’an Public Security Bureau of Nantong
According to insiders, the police officer who accepted the report and registered the case from “Uncle Cao” was Wu, and Wu also participated in the subsequent investigation and inquiry work of the case, and was the police officer in charge of the case.
According to an article entitled “Wu Jinguo: I am forty-three this year, how to pass the test?” published on December 3, 2017, by the official WeChat public account “Hai’an Public Security Micro Police Affairs” of Nantong, it was written: “In this big family, everyone cooperates, encourages each other, and does their job well, interpreting their own police life in their respective positions. Here, there is the oldest public security police officer in the country, Cao (the “victim Uncle Cao” in this case), who insisted on handling the case with us on the day of his retirement”.
In Wu Jinguo’s memoir article, he mentioned his colleague “Cao”
“The whole case accused that there were as many as 100,000 victims, but only one police officer ‘Uncle Cao’ from the case-handling unit took the initiative to report that he was deceived. And the nearly 100,000 customers of the company involved in the case nationwide rarely even filed administrative complaints.” In court, the defense lawyers questioned that the police had the suspicion of “fishing law enforcement” and applied to request “victim Uncle Cao” to appear in court, but the court has not yet made a decision.
When questioning the Nantong police’s case-handling procedures, the defense lawyers emphasized that the case belonged to the typical “profit-seeking” law enforcement. The case file did not have the statutory “cooperation procedures” for the Nantong Public Security to dispatch hundreds of police officers to carry out arrests in other places. The Nantong Public Security Bureau’s large-scale organization of arrests in other places seriously violated the “six prohibitions” of the Ministry of Public Security on handling cases in other places.
Controversy over the sale of regular weight loss drugs being accused of fraud, hundreds of people “passed the court” denied the charges
It is understood that Guan Wenqi and 109 defendants, including employees of Zhongfu Internet Hospital, were tried in two cases in the Haian City Court and Haimen District Court of Nantong. Among them, Guan Wenqi and 59 other defendants were tried in the Haian Court in February 2022, and no judgment has been made so far. The trial in the Haimen Court, which began on September 12, was for 50 employees of the Baoding Fifth Branch of Zhongfu Internet Hospital (hereinafter referred to as “Baoding Five Company”).
In the police report, it was said that this was “a medical and health product company disguised with a legal appearance” and “specialized in the sale of fake health products”. However, according to the company’s introduction, all the drugs and foods involved in the case were regular products. The weight loss drug “Orlistat” accused of being sold in the Haimen case is the only over-the-counter (OTC) weight loss drug approved in China, and it is also the only over-the-counter weight loss drug approved by the FDA, CFDA, and EMA in the world, which can be said to be as regular as possible.
The prosecution alleged that Baoding Five Company used false advertisements to attract customers, used false identities such as slimming consultants and slimming planners to induce customers to buy high-priced weight loss products. In court, the defendants and defense lawyers did not agree with the prosecution’s charges. They stated in the trial that the weight loss drug “Orlistat” involved in the case had been proven effective by a large number of medical studies, and it has been widely used in the weight loss treatment of obese people in practice. The company’s customers also have a large number of successful weight loss cases, and the identities of slimming consultants and planners are the common names in the industry, just like “sales consultants”, and are not legally required to obtain professional qualification certificates. Therefore, there is no situation of impersonation; even if the advertisements involved have exaggerated and false elements, they belong to the scope of administrative penalties. The fact that needs to be taken seriously is that there are many successful weight loss cases, but it is unlikely to use real cases in advertisements to protect the privacy of customers.
According to the statements of many defendants in court, Baoding Five Company has strict compliance systems, and the relevant sales processes have been reviewed by professional lawyers. The company also has strict sales “forbidden words” and strictly prohibits employees from using identities such as “experts” and “doctors” to communicate with customers. The company also set up a quality inspection department, and the employees in charge of this work can directly check the call recordings and WeChat chat records between employees and customers through the background system. If anyone is found to violate the company’s regulations, they will be fined for minor offenses and fired for serious offenses. In the company’s structure, there are also dedicated personnel responsible for refunds and returns. “As long as the customer requests a refund, the company will meet it.”
According to public information, Guan Wenqi entered the pharmaceutical and health industry around 2008. He became the chairman of the Beijing Health Industry Association in 2016. The association’s member units include many well-known brands. An industry insider introduced that the Internet + health industry and chronic disease medical system are industries that the state has strongly supported and developed in recent years. There are millions of practitioners in similar marketing models under the digital economy, and the Guan Wenqi case can be regarded as a cross-border bellwether of “Internet + health”.
More than half of the defendants do not have defense lawyers, violating the judicial policy of full coverage of criminal defense
According to multiple sources, among the 109 defendants tried separately in the Haian Court and Haimen Court, as many as 59 defendants did not have defense lawyers appearing in court. Among them, in the case of Guan Wenqi and 59 others tried in the Haian Court, only 10 defendants hired lawyers, and the remaining 40 defendants did not have lawyers to defend them.
In the case tried in Haimen, 10 of the 50 defendants did not have lawyers to defend them. Some defendants clearly stated that they did not have money to hire lawyers, and the free legal aid lawyers arranged by the relevant departments did not succeed in providing assistance for various reasons. “The legal aid lawyer arranged told me directly that he only understands civil affairs and does not do criminal affairs.” Some defendants said that they refused such legal aid lawyers to defend them and hoped to obtain responsible and serious legal aid lawyers to help them defend.
As early as December 27, 2018, the Supreme People’s Court and the Ministry of Justice required in the “Notice on Expanding the Pilot Scope of Full Coverage of Lawyer Defense in Criminal Cases” that “by the end of 2019, Tianjin, Jiangsu, Fujian, Shandong and other provinces (municipalities directly under the Central Government) will basically achieve full coverage of the entire jurisdiction.” On October 12, 2022, the Supreme People’s Court, the Supreme People’s Procuratorate, the Ministry of Public Security, and the Ministry of Justice again issued the “Opinions on Further Deepening the Pilot Work of Full Coverage of Lawyer Defense in Criminal Cases”, which clearly required “to determine the scope of notification and defense. If the suspect has not entrusted a defense lawyer and has one of the following circumstances: may be sentenced to more than three years of imprisonment, the person or his co-criminal suspect refuses to plead guilty, the case is serious and complex, and may cause major social impact, the people’s procuratorate shall notify the legal aid agency to appoint a lawyer to provide defense for him.” The Haimen Court also announced that it had achieved full coverage of criminal defense as early as May 2018.
Some lawyers said that the amount of money involved in this case is huge, often tens of millions or hundreds of millions of yuan, which belongs to the situation where the statutory sentence can be more than 10 years, and the case is serious and complex, which may cause major social impact, and belongs to the situation of “co-criminal suspects refusing to plead guilty”. In the court, the vast majority of the defendants clearly stated that they did not recognize the charges and facts when accepting the court’s interrogation. Therefore, the defendants not having lawyers violates the relevant judicial policy.
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