Phone fraud still rampant in China despite massive crackdown

Recent tragic cases in which students and lecturers have been swindled out of their savings prompts public security minister Guo Shengkun to label the crime a ‘major public hazard’

PUBLISHED : Sunday, 11 September, 2016, 6:00am
UPDATED : Sunday, 11 September, 2016, 6:55am

Recent telephone scams that targeted university students and teachers, resulting in some taking their own lives after being cheated, have put the mainland’s loose regulation of the telecoms industry and easy illegal access to personal information in the spotlight.

Public Security Minister Guo Shengkun has ordered an intensified crackdown on telecoms fraud scams and told the various departments involved to cooperate more closely to curb the high incidence of this type of crime.

Hundreds arrested as police crack phone-scam gangs based overseas targeting Hong Kong, mainland China

The minister said that while many fraud rings based at both home and abroad had been raided in the past year, the crime was still rampant and had become a major public hazard.

Guo made the remarks while inspecting Shanghai’s anti-telecoms fraud website that uses resources from the police, banks and telecoms firms to mitigate phone scams. Since it was set up in March, the platform has frozen a combined 79 million yuan (HK$92 million) in transfers and prevented about 35,000 people from becoming victims.

In recent weeks, the high number of students and teachers being cheated had aroused wide public attention, Guo said.

In one of the most sensational and tragic cases, Xu Yuyu, a student from a poor family in Shandong province, was cheated out of 9,900 yuan after scammers posing as officials from the Ministry of Education told her to pay her tuition fees into a bank account that belonged to one of the criminals.

Early this month, Duan Jinke, a university student in Changchun, Jilin province, apparently took his own life after losing 5,000 yuan that his impoverished family in Yunnan had scraped together for his tuition.

Even academics are not immune to the scams. A lecturer at Tsinghua University in Beijing lost 17.6 million yuan, police said. The teacher sold the family home to raise some of the money and borrowed the rest, the Beijing Youth Daily reported.

The teacher’s case involved a typical scam in which the callers claim to be police or court officials. The victims are told that they are suspects in certain crimes, such as money laundering or possessing drugs, and must remit funds to so-called security accounts (owned by the criminals) so the investigations can proceed.

Some Chinese phone scam victims may get money back after police seize Ұ1.4b from gangs

Li Tiejun, a security expert from Cheetah Mobile, a domestic internet security company, told People’s Daily that mass leaks of personal data had occurred at universities through their management departments which had poor awareness of data security.

QQ, the most popular chatting tool among university students, is another source hackers can use to access personal information because some group chatting managers don’t set barriers to block newcomers, according to the newspaper.

Recent report by shed light on how scammers used mobile numbers that started with “170” and “171”. The numbers are operated by virtual telecoms operators which entered the market three years ago as the central authorities sought to boost competition in the sector.

Without their own basic network, virtual operators rent wholesale services like voice and text messages from the three main operators – China Mobile, China Unicom and China Telecom – which they sell to customers.

Some Chinese phone scam victims may get money back after police seize Ұ1.4b from gangs

All telephone users on the mainland are required to register with their real names and present their identity cards. But lax regulation and oversight has allowed scammers to flourish.

Although many of the phone numbers used in scams have been registered, they are not used by the person whose ID was used in the registration.