No deposits, no ID retention, no “training loans”, no pyramid schemes, no usurious loans

15. No deposits, no ID retention, no “training loans”, no pyramid schemes, no usurious loans

Cost: Zero expense. If an employer or recruiter suggests “pay first before starting work”, “pay for training before placement”, or “recruit others to earn money”, reject it on the spot. Keep chat logs and any transfer receipts. The difficulty is that when money is tight, people may feel tempted to take the risk; saying “no” right away isn’t always easy.

In plain terms: Employers are not allowed to keep your ID or other documents, nor demand any deposits or payments under any pretext. Violators must return all money and face fines ranging from 500 to 2000 yuan per person. If a job placement fails, recruitment agencies must refund any fees paid. “Training loans” that require upfront payment for training, as well as pyramid schemes that pay out based on recruiting new members, are both officially flagged as scams. For private loans, any interest exceeding four times the one‑year LPR is not enforceable by courts, though the principal must still be repaid.

Benefit: Companies cannot retain your ID or other documents, cannot ask for guarantors, and cannot demand payments under any name. Breaching these rules results in mandatory repayment plus fines of at least 500 yuan and up to 2000 yuan per person. Recruitment agencies likewise must return all fees if they fail to place you. Schemes that pose as job offers but require you to pay training fees or take out loans are the so‑called “job‑to‑training” or “training loan” frauds highlighted by multiple government agencies. Pyramid schemes that pay commissions based on recruiting others and require upfront payments are illegal; participants can be fined up to 2000 yuan. Interest on private loans that exceeds four times the one‑year LPR at the time of signing is not legally binding. This new rule replaced the previous three‑tier system based on 24% and 36% thresholds (nationwide, effective August 2020).

Evidence grade: A

Sources: National People's Congress Standing Committee (2007). Labor Contract Law (Presidential Order No. 65, Articles 9, 84). <https://www.gov.cn/gongbao/content/2007/content_711013.htm>; Ministry of Labor and Social Security (2007). Employment Services and Employment Management Regulations (Ministry of Labor and Social Security Order No. 28, Articles 14, 55, 58). <https://www.gov.cn/zhengce/2022-11/28/content_5711307.htm>; Ministry of Human Resources and Social Security of China and five other departments (2026). Be wary of risk warnings such as "recruitment-to-training" and "training loans". <https://chinajob.mohrss.gov.cn/h5/c/2026-05-18/543038.shtml>; State Council of China (2005). Regulations on the Prohibition of Pyramid Selling (State Council of China Order No. 444, Articles 2, 7, and 24). <https://www.gov.cn/gongbao/content/2005/content_80604.htm>; Supreme People's Court of China (2020). Decision on amending the "Regulations on Several Issues Concerning the Application of Law in the Trial of Private Lending Cases" (Fa Interpretation [2020] No. 6, Article 26). <https://www.court.gov.cn/fabu/xiangqing/249031.html>; Supreme People's Court of China (2020). The upper limit of judicial protection of private lending interest rates is adjusted to "4 times the one-year LPR". <https://www.court.gov.cn/zixun/xiangqing/249051.html>

Notes: Four times the LPR is the maximum interest rate courts will protect; it does not mean the principal can be waived. The principal must still be repaid. This judicial interpretation was amended again in December 2020, so the current article numbers apply. When money is urgently needed, people are especially vulnerable to these schemes. Instead, use the legitimate channels mentioned earlier in this section: unemployment benefits, labor‑inspection complaints, legal aid, shelters, or emergency assistance.