Zhou Yongjun, a student leader of the 1989 demonstrations that were ended by a bloody army crackdown, was also fined 80,000 yuan (11,700 dollars) by a county court in the southwest province of Sichuan, his lawyer Chen Zerui told AFP.
"The judge only read out the sentence -- we are still awaiting the formal written verdict," Chen said.
"We will appeal," he added, refusing any further comment on the case, other than expressing the hope that either Zhou's conviction would be overturned or his sentence reduced on appeal.
Zhou was arrested in Hong Kong in September 2008 and handed over to Chinese police in a case that brought into question the "high degree of autonomy" that Beijing promised the city upon its 1997 handover from Britain.
According to the Hong Kong-based Information Centre for Human Rights and Democracy, Zhou has been in and out of China since serving two years in prison following the Tiananmen crackdown.
After fleeing to the United States, he returned to China in 1998. He was rearrested and sentenced without trial to three years of hard labour.
Upon his release, he again fled to the United States, it said.
When arrested in Hong Kong, Zhou was carrying a fake passport and had allegedly tried to receive funds from Hong Kong's Hang Seng Bank under the name given on the false document, the Centre said.
His fraud conviction stems from the attempted transaction, it said.
During the trial, Zhou denied the charge against him, saying he had been the victim of bad luck and mistaken identity, the centre said.
At the time of his arrest in Hong Kong, Zhou had been planning to return to the mainland to visit his ailing father in Sichuan, it said.
Hong Kong was returned to Chinese rule in 1997 with the promise of a high degree of autonomy that included a separate judicial system.
Critics say Zhou's case has brought into question that promise, and noted that the case should have been tried in Hong Kong where the crime allegedly took place.