Tengyue Company believed that the loophole in this process was mainly due to not specifying the total amount in both figures and words on the meter, allowing Dai to make "four limbs" corrections to the engineering numbers after obtaining step-by-step approval signatures and before handing it over to the payroll group. For example, adding a "1" in front or a "0" at the end, causing some of the engineering volume to double. The payroll group, being unfamiliar with the engineering volume and seeing all necessary signatures, then processed the payment which was sent to Dai by the finance group.
The defense attorney also raised doubts about the audit report used as evidence for sentencing. He said that the audit clearly showed there were no design drawings or on-site verification materials, making the conclusions uncertain. Moreover, Dai had always been actively fulfilling his contractual obligations, completing the installation, dismantling, and maintenance of the "hoist," only involving disputes over confirmation and settlement of actual engineering volume, which does not fall under relevant provisions of criminal law.
Case Recap: Fraud exceeding 3.7 million yuan across 9 construction sites
Dai appealed to Foshan Intermediate People's Court against the ruling.
After deliberation, Shunde Court held that Dai’s denial during the trial lacked sufficient justification and that the identification procedures were legitimate. The defense counsel's arguments were insufficient and lacked contradictory evidence, thus they were not adopted.
On September 29, Shunde Court ruled that Dai disregarded national laws, with the intent to illegally possess property, defrauding the victim of assets during the execution of the contract, in an especially large amount. Therefore, he was found guilty of contract fraud and sentenced to 13 years in prison, deprived of political rights for 2 years, and fined 13,000 yuan. The frozen deposits and sealed cars will be returned to the victim Tengyue Company.
South China Morning Post reported (by Tang Meng) that "contractor" Dai, who had cooperated with a well-known domestic real estate developer for more than 10 years, was last year accused of defrauding 3.7 million yuan in engineering payments through false reporting of engineering volumes and modifying settlement forms. Shunde Court initially ruled that he was guilty of contract fraud and sentenced him to 13 years in prison. Both Dai and his defense lawyer insisted that the case was a civil dispute. Recently, Dai has appealed to Foshan Intermediate People's Court.
During the trial, Dai denied the charges, claiming that he did not defraud Tengyue Company of engineering payments and did not commit any crime.
First Instance Judgment: Sentenced to 13 years for contract fraud
Trial Denial: It is an economic contract dispute, not fraud
Dai's defense lawyer argued that this case essentially was a contractual dispute between Tengyue Company and Dai, a typical civil dispute. The investigation agency's use of criminal means to intervene in civil disputes suspected abuse of public power. Whether Dai exaggerated the engineering volume or overcharged for engineering payments could be fully clarified by verifying related evidence materials, followed by negotiation or direct litigation in court according to the contract agreement.
Shunde Procuratorate charged that since 1997, Dai had established a long-term contractual cooperation relationship with Guangdong Tengyue Construction Engineering Co., Ltd. (hereinafter referred to as "Tengyue Company"), providing installation, dismantling, and maintenance services for material hoists (commonly known as "hoists") at Tengyue Company's construction sites. From the end of 2007 to February 2010, Dai exaggerated his engineering volume and payments by falsely reporting engineering amounts, altering settlement forms, forging supervisor signatures, and repeating settlements, intending to defraud Tengyue Company of engineering payments. After auditing, among nine projects developed by a well-known domestic real estate developer in Qingyuan, Zhaoqing, Gaoyao, etc., Dai's actual entitled engineering payment was 2,135,485.16 yuan, but Tengyue Company paid Dai 5,104,047.24 yuan via bank transfer. Thus, Dai defrauded Tengyue Company of engineering payments totaling 3,760,915.58 yuan, with 792,353.50 yuan being an attempted fraud.