Abstract: In the process of carrying out the mainland policy in modern Japan, “the TwentyOne Demands” is an important practice of Japans “Keep North and Go South” invasion of China. Following the failure of the Okuma Cabinets armed invasion of China, the Terauchi Cabinet transformed its strategy,vigorously pursued economic invasion of China centered on the Nishihara loans, and collected a large number of new rights which had not been obtained by “the TwentyOne Demands”. In this process, Cao Rulin, Lu Zongyu and Zhang Zongxiang provided much help. Around the May 4th Movement, there were both facts and rumors about the antiJapanese factions evidence of “betrayal” of Cao, Lu and Zhang. However, Cao, Lu and Zhangs own argument of “no rebate” and “taking back Shandongs rights” could not withstand the test of historical facts and logical inference. Therefore, Nishihara Loans is not only the key link of inheriting “the TwentyOne Demands” and opening the May 4th Movement, but also the key evidence to confirm the identity of Cao, Lu and Zhang as “traitors”.

Key words: Nishihara Loans, “the TwentyOne Demands”, The May 4th Movement, traitor, rebate