A mobile payment app called "Seaweed Life", claiming to be a "small and micro merchant payment tool", is actually an illegal cash out tool for credit cards, with a total transaction volume of over 9.1 billion yuan. Recently, after being prosecuted by the People's Procuratorate of Guannan County, Jiangsu Province, the main offender Lv Mouliang was sentenced to five years and six months in prison and fined 6 million yuan by the court for the crime of illegal business operations. In January 2019, Lv Mouliang and Zhan Moumou collaborated with Shanghai Yinshengbao Company (handled separately) to develop the "Seaweed Life" app with virtual transaction functions, providing users with credit card cash out services and illegally profiting by charging transaction fees. Yinshengbao Company provides third-party payment channels and payment licenses, with Lv Mouliang and his brother Lv Mouwen responsible for technology development, operation, and maintenance, and Zhan Mou responsible for market promotion and development agency. After multiple internal tests, the "Seaweed Life" app was officially launched in April 2021. Users can become registered users by binding their personal ID card, savings card, and reserved phone number on the savings card, and authenticating through facial recognition. Click on "Collection and Payment" in the app, enter the amount, select the bound credit card as the payment account, and the app backend will automatically match the pre imported merchant information to complete the credit card consumption in the form of a virtual transaction. After deducting a certain percentage of transaction fees, the consumption amount will be automatically refunded to the user's linked savings card within about 10 seconds, achieving fast withdrawal. Lv Mouliang and others also launched the "Seaweed Exhibition Industry" app as an agent, which developed over 7000 agents through a tiered commission mechanism, with agent fees generally ranging from 0.45% to 0.53%. Lv Mouliang and others marked the words "under Yinshengbao" on the homepage of the "Seaweed Life" app, attracting some people to contact Yinshengbao 400 for consultation on agency matters after seeing the information. Liao became an agent through this method. In June 2023, payment channels were closed due to internal operational issues with Yinshengbao. Lv Mouliang immediately contacted Tang Mouzhong, who has third-party payment channel resources, and Tang Mouzhong connected his proxy payment channel to the backend of the "Seaweed Life" app. As of the time of the incident, the backend users of the "Seaweed Life" app have reached over 37000, with a total transaction volume of over 9.1 billion yuan. In July 2024, the case was transferred to the Guannan County Procuratorate for review and prosecution. After examination, the procuratorial organ found that the merchant data on the platform was not registered by the merchants themselves, but directly imported from the backend, and there were no real transactions. All functions were used for fictitious transaction cashing out. In addition to the payment function, the app cannot use functions such as scanning, recharging phone bills, seagrass mall, credit card application, insurance, etc. The so-called transaction is to transfer the user's credit card funds to the user's own savings card, which is a completely fictional transaction that is completely detached from the real transaction scenario Prosecutor Zhang Hui from Guannan County Procuratorate said. The Guannan County Procuratorate held a joint meeting of prosecutors to clarify that third-party payment qualifications are not equivalent to legalizing fictitious transactions. We determine whether it constitutes illegal business mainly based on the content of the operation. Although third-party payment companies have payment licenses, they cannot engage in illegal fund payment and settlement, nor can they legalize fictitious transactions. Therefore, the behavior of Lv Mouliang and others is illegal business. "Wei Zhen, the chief prosecutor of Guannan County Procuratorate, introduced that through fictitious transactions, they illegally changed the credit card consumption credit function and transformed it into cash loans, making it impossible for the issuing institution to accurately judge the credit status and fund use of cardholders, which violates relevant regulations. In October 2024, the Guannan County Procuratorate prosecuted five individuals, namely Lv Mouliang, Zhan Mou, Tang Mouzhong, Liao Mou, and Lv Mouwen, for illegal business operations in accordance with the law. After trial, the court fully adopted the sentencing recommendations put forward by the procuratorial organs and made the above judgment on Lv Mouliang. At the same time, taking into account the circumstances of meritorious service, confession, confession of guilt and punishment, and return of stolen goods, Zhan, Tang, Liao, and Lv were sentenced to two years, six months, to three years in prison for the crime of illegal business operation, all of whom were subject to probation, and each was fined 300000 to 3 million yuan. In response to the regulatory loopholes discovered during the investigation of third-party payments and credit card payments, the procuratorial organs promptly reminded credit card issuing banks and relevant financial institutions to plug the loopholes of illegal cash withdrawals from credit cards and jointly maintain the order of the financial market. (New Society)