China is battling an explosion of telecoms fraud that has cost billions of dollars in financial losses and driven some people to suicide, according to authorities in Beijing, who say criminal gangs based in Taiwan are behind many of the scams.
Chinese state media outlets have blamed weak punishments in Taiwan and reported that Chinese-speaking fraudsters recruited in Taiwan are increasingly setting up operations in East Africa or Southeast Asia.
Despite political tensions, the two sides have in recent years cooperated on investigating such scams, but Taiwan has said Chinese authorities sometimes do not provide enough evidence for them to do anything.
“We are a democratic, rule of law country,” the Criminal Investigation Bureau’s 7th Investigation Corps Captain Chang Wen-yuan (張文源) said. “In this respect, we emphasize the proof or lack of evidence. You can’t just say, ‘today media reports the person committed a crime,’ just like that.”
Chang was speaking after China slammed Taiwan for freeing 20 suspects deported to Taiwan from Malaysia in an alleged telecoms fraud case.
Most were re-detained on Thursday, prosecutors said.
While many of the reports in Chinese state media cannot be independently verified, the scale of the problem was underlined by another spat that erupted earlier this month when Kenya deported 45 Taiwanese suspected of involvement with a telephone fraud scam in China, prompting accusations of kidnapping from Taipei.
Chinese police said the case was typical of such operations, which often target the elderly, students or unemployed and involve a caller posing as some kind of government official.
According to details provided to China’s state media, robotically delivered, pre-recorded messages were sent to people in China claiming there was a problem with their medical insurance.
Those who responded were put through to one of multiple lines in a house in a Nairobi suburb, Xinhua news agency reported, where a bogus police officer following an elaborate script would tell the caller that their bank accounts had been compromised and convince them to transfer money to a “safe” account.
Scammers have also been known to fake arrests or abductions of family members, or to try to convince people that money was needed in legal disputes involving relatives.
Chinese authorities registered 590,000 telecoms fraud cases last year, according to Chinese Ministry of Public Security statistics cited by Xinhua, up from about 100,000 in 2011, leading to losses of 22.2 billion yuan (US$3.42 billion).
On average, more than 10 billion yuan is swindled out of China to Taiwan by telephone scammers per year, Xinhua said.
Since 2011, Taiwan and China have cooperated in investigating telecoms fraud in Indonesia, Cambodia, Philippines and other countries, arresting more than 7,700 suspects, including 4,600 Taiwanese, the report said.
“Most of the people they are arresting are the mules,” said Lennon Chang, a criminologist and expert in telecoms fraud at Monash University in Melbourne, Australia. “They are not the real leaders or heads of the criminal organized syndicates.”
Chang said that telecoms fraud took hold in Taiwan in the early 1990s, before a crackdown prompted scammers to shift operations to Xiamen, a port in southeastern China that is just a few kilometers from the Taiwan-controlled island of Kinmen.
There, fraudsters could pick up Taiwanese mobile phone signals to call Taiwanese, hiding behind the lack of law enforcement cooperation across the Taiwan Strait.
Later they began targeting China, Chang said, but as authorities in Taiwan and China began to collaborate, the gangs were pushed to third countries, aided by advances in technology and moving frequently to make evidence collection harder.
Chinese state media have reported harrowing tales of the victims of such scams.
The People’s Daily Web site in January reported one case in which a man from the central province of Henan who transferred 10,000 yuan to fraudsters hanged himself outside of a branch of the Agricultural Bank of China after the bank and police were unable to help him recover his money.
He had been convinced to invest in a fake business.
Official Chinese news outlets have also run stories contrasting sentences in China, where life terms have been meted out for telephone fraud, with jail time of just a few years for similar crimes in Taiwan.
“Because of Taiwan’s generally light penalties for telecoms fraud ... many suspects are not severely punished or not convicted,” Xinhua said in a report on Friday last week.
Taichung chief prosecutor Hung Chia-yuan (洪家原) said that in the past three to four years the district had investigated — alongside Chinese authorities — cases involving more than 970 people, mostly Taiwanese suspected of telecoms fraud in third countries.
Sentences for fraud in Taiwan range from one to seven years for each person affected, up to a maximum 30 years, he said, adding that sentences in China are often commuted after a few years for good behavior.
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