Efforts to curb scams succeeding, but situation remains grim

The crackdown on telecom fraud has achieved good results, but the situation remains complicated and grim and requires comprehensive social governance, authorities said.

According to the Ministry of Public Security, the number of registered telecom fraud cases has decreased continuously since last June due to effective measures taken by all relevant departments.

Liu Zhongyi, head of the criminal investigation bureau at the Ministry of Public Security, said that telecom fraud has evolved significantly in tandem with technology in recent years, and fraudsters are taking advantage of global problems such as the COVID-19 pandemic.

"Currently, telecom fraud is growing rapidly in developed countries," he said. "With COVID-19 rampant, more people are relying on the internet to work and purchase goods. This has further exacerbated the problem."

Fraud gangs closely follow social media trends and alter their scripts according to illegally gathered personal information to better target different groups. Public security organs have uncovered over 50 types of fraud, including those related to investment and financial management and online loans.

Some fraudsters also pretend to be customer service agents and even impersonate officers from public security organs, procuratorates and courts, Liu said.

The gangs capitalize on blockchain, virtual currency, GoIP, artificial intelligence and other technologies to commit crimes. As the number of tools they can use grows, the number of crimes is escalating, he said.

"About 60 percent of telecom fraud cases are committed through fake apps, and the swindlers have begun to make extensive use of SMS, virtual private networks, cloud voice calls and foreign phone cards to commit fraud," Liu said. "Also, they have reduced their usage of third-party payment or corporate accounts for money laundering, opting to use digital currencies instead."

He said that gangs are well organized, with leaders often hiding abroad and recruiting inexperienced youngsters through promises of high salaries. Via chat software, they instruct people on the Chinese mainland to engage in various crimes.

"There are still a large number of criminal gangs in Cambodia, the Philippines, the United Arab Emirates, Turkey, northern Myanmar and other countries and regions committing fraud targeting Chinese citizens," Liu said.

The general offices of the Central Committee of the Communist Party of China and the State Council jointly issued a document in April on strengthening the crackdown on telecom fraud.

The financial, telecommunications, internet and other industries should improve their ability to fight fraud, it said.

Sui Jing, head of the network security administration bureau of the Ministry of Industry and Information Technology, said that it has set up anti-fraud teams and strengthened cooperation with public security organs.

Last year, the ministry disposed of 97 million phone cards and removed 57 million internet accounts affiliated with them to thwart gangs.

"The ministry will improve governance of the internet and cross-border telecoms, strengthen the regulation of key businesses involved in fraud and steadily promote credit management," Sui said. "Furthermore, anti-fraud technologies will be enhanced to improve integrated technology as well as defensive monitoring and early warning."

Telecom operators in the provinces of Zhejiang, Henan, Jiangxi, Liaoning, and Guizhou have blocked text messages and phone calls by default from Hong Kong, Macao, Taiwan and international locations to prevent cross-border telecom fraud and protect customer safety.