Hainan issues measures to address fraudulent claims and loans related to housing provident funds

This article is sourced from: Sanya Daily

Hainan has issued measures to handle fraudulent over-withdrawal and fraudulent loan-taking involving housing provident fund

Effective starting May 1

Our reporter, Lu Zhizi: Using false materials to withdraw housing provident fund, fabricating housing consumption activities, and repeatedly buying and selling the same property to extract housing provident fund… these types of fraudulent over-withdrawal and fraudulent loan-taking will be handled in accordance with law. On April 1, the Hainan Provincial Housing Provident Fund Management Bureau issued the 《Measures for Handling Fraudulent Over-withdrawal and Fraudulent Loan-taking Involving Housing Provident Fund in Hainan》, which clearly defines eight categories of “fraudulent over-withdrawal” behaviors and six categories of “fraudulent loan-taking” behaviors. The measures will be formally implemented starting May 1, establishing a system-based line of defense to ensure the safety of housing provident fund funds.

In terms of determining the conduct, the 《Measures》 specify eight categories of “fraudulent over-withdrawal” behaviors and six categories of “fraudulent loan-taking” behaviors. “Fraudulent over-withdrawal” mainly includes withdrawing housing provident fund by using false materials or concealing true information; fabricating housing consumption activities; extracting housing provident fund by means such as purchasing a home through multiple changes of marital status by the same person, or multiple people frequently buying and selling the same unit/property; making false promises to withdraw housing provident fund; and forcibly withholding housing provident fund through false litigation. Conduct will be deemed “fraudulent over-withdrawal” in cases where, after being ordered to refund, the person refuses to refund, or where after withdrawal, funds need to be returned due to the cancellation of housing record/registration, but the person refuses to return them. “Fraudulent loan-taking” includes applying for or obtaining housing provident fund loans using false materials or concealing true information; fabricating real-estate transaction applications to obtain loans; loan purposes that do not comply with regulations; or using the funds in ways that do not comply with the rules. Conduct will be deemed “fraudulent loan-taking” in cases where, after being ordered to rectify, the person refuses to do so, or where after obtaining a loan, the loan needs to be settled due to the cancellation of housing record/registration, but the person refuses to settle it.

The 《Measures》 set out a complete process—from discovering leads, to filing an investigation, to making a handling decision, and then applying to the court for compulsory enforcement. After discovering suspected conduct, the Hainan Provincial Housing Provident Fund Management Bureau will first preserve relevant materials, pause business processing, and conduct a preliminary verification. After filing the case, it will make a handling decision within 90 days; if the circumstances are complex, the period may be extended by 60 days. After the investigation is concluded, if the facts are clear, it will issue an 《Administrative Handling Decision》 in accordance with law.

For verified and confirmed fraudulent over-withdrawal and fraudulent loan-taking conduct, the 《Measures》 specify multiple handling measures, including criticism and education, ordering a deadline for refunds, notifying the person’s unit/employer of the situation, conducting credit assessments/evaluations, transferring the matter to competent authorities for accountability, and sharing information about dishonesty/lack of good faith. If the party refuses to make a refund, they will also face restrictive measures such as limiting further withdrawals, reducing the loan amount, and requiring earlier loan repayment/early loan maturity. For units and individuals that assist with fraudulent over-withdrawal and fraudulent loan-taking, measures will also be taken, such as disclosing information through the media, notifying relevant competent authorities, and conducting credit assessments/evaluations.

The 《Measures》 also stipulate circumstances under which handling may be mitigated, reduced, or exempted. If the party makes an honest admission, shows good attitude toward correcting mistakes, actively cooperates with the investigation, voluntarily refunds the full amount, and has not caused serious consequences, handling may be determined with appropriate mitigation.