These statistics, cases investigated by police, can be a severe underestimate of the number of actual cases, because many victims may not report and many reported cases may not be investigated by the police.
Everyday on twitter I see stories of fraud inside and outside of China. The ones impressed me most are about overseas Chineses, after a visit to the Chinese consulate, start getting phone calls that are suspicious.
For example, in Jan 2021, a Dutch-Chinese posted on twitter:
(rough translation)
For the first time in all my years abroad, I received a scam phone call today. It pretended to be from the Chinese Embassy. They called my personal mobile phone, gave me my name exactly and then asked me if I had reported my health condition. Why haven't you reported it? Then all of sudden, they asked are you okay? I already knew what was going on and deliberately said yes, the other person froze and said why haven't you reported it? I directly called him a scammer and he hang up and never called back.
The information is obviously sold by people from the China Visa Center.
She commented that she had left her telephone number to the Visa center for her trip to China.
When I google Fraud in Chinese, the fifth result is a warning from the Chinese consulate in San Francisco, posted in June 2020. The title is “Chinese citizens in the consular district are reminded to beware of epidemic-related scams”.
The first paragraph goes:
(rough translation)
For some time now, unscrupulous criminals have been rampant, posing as Chinese embassies and consulates abroad, domestic public prosecutors and the FBI to perform various scams. The common tactic is still to fraudulently claim that the person concerned is involved in a criminal or immigration case, brainwash them and then steal money from them. Or ask them to cut off contact with the outside world and then turn to their next of kin to fraudulently claim kidnapping and then steal money from them. During the epidemic, the unscrupulous criminals have developed new tricks such as "sending masks illegally" and "selling tickets of a chartered plane", and some people have recently been duped by this.
This is overseas. In China, the situation is much worse. For example, Financial Times had “China fights a financial fraud explosion” in Dec. 2021. In the article, FT identified part of the reasons as: “Financial schemes have a long history of thriving in China, where decades of runaway economic growth have created not only enormous personal wealth but also a get-rich-quick mindset among the public. Fraudsters have also profited from a lack of regulation and a state-imposed ceiling on deposit rates, which have made it easier for them to convince clients who are keen to get a higher return on their hard-earned savings. “
Two graphs of statistics highlighted the rapid growth in recent years:
These statistics, cases investigated by police, can be a severe underestimate of the number of actual cases, because many victims may not report and many reported cases may not be investigated by the police.
But the reason that people fall for financial frauds is not just the high return promised. In a lot of cases, the scammer successfully convinced the victims that they were banks or the police. How? Because there is a very mature market of privacy data.
Back in 2016, for a few days, I was seeing photos of ID cards of the most powerful people in China on twitter. It was very tempting for me to save the photo of Jack Ma’s ID. Because to get a Weibo account, you need an ID number, and I don’t have one. I am just joking, I am not JackMa666 on Weibo. The temptation did last a full second though.
This was reported, for example, by VOA, in Chinese and New York Times, in English.
The person who posted those personal information claimed that he was doing it to raise awareness of massive negligence of privacy in Chinese system. He commented: “I hope this can get fellow countrymen thinking. Personal privacy is worth nothing in China.” (which is not exactly true, since you can sell the data)
The account was suspended for violating twitter rules. But it did create some buzz for a few days.
How much did the Chinese system change since then? I found the most recent news report on data breaching and transactions, for the year 2020.
Here is some selected news:
- The conclusion of a case of illegally selling 200 million personal data at 1 cent a piece between 2013 and 2016.
- In March, people discovered 500 million data from Weibo being sold on the dark web, including cell phone numbers linked to Weibo account information.
- Personal information in a local hospital leaked on Wechat. There are more than 6000 people’s ID, phone number, address, hospital records in it.
- College students discovered that their personal information was used by companies to evade tax. Estimated number of cases in thousands.
- Employees of a bank sold personal information of the customers.
[…]
- Employees of a logistic company sold information on 400 thousand customers.
[…]
- At the end of 2020, reporters discovered that some recruitment platform sold the personal information of their users. People who just uploaded their resume onto the websites get harassment phone calls shortly after.
As you can see, the all powerful Chinese government is facing a steep challenge. I hope you haven’t disclosed too much to your Aliexpress vendor.
So, in March 2021, the Government rolled out this new shining app, called App of the national center of anti-fraud. All levels of government, especially the police, are actively persuading people to install it on their phone.
On twitter and Wechat, people are talking about queuing for the vaccine shot and a police comes along checking people’s phone and demanding them to install the app. Few can resist the persistent demand.
Even at school, teachers were asking the students to make sure their parents put this app on their phones.
What does it do? According to wikipedia, it
(rough translation) detects received calls and SMS messages, checks downloaded apps and will actively alert users if suspicious content is found and identified as fraudulent. The app also provides a "I want to report" function, enabling users to submit suspicious mobile phone numbers, SMS, websites and apps to the public security authorities for action. In addition, the app pushes articles on fraud prevention to users to promote fraud prevention.
But, some people think it is a monitoring app. For example, in May, a girl found out how the installed app is used. She posted her story in a thread named “Societal Death” (meaning the event was very embarrassing and she became socially dead because of it):
(rough translation) Note Before I die! I never imagined the first time I talked to the uncle police would be for this
Girls, wuwuwu, today, I clicked a link that led me to a yellow manga (Hentai?). At night, the anti-fraud center called me. I thought it was a scammer so I did not pick up. The app sent me warning messages. The police called me from 8pm till 10pm, when I had no signal. They just showed up where I live.
(screenshot of the conversation)
Police: Our police car is right in front of your door. Can you come out now?
Me: Yes.
Back in April 2021, Fang Zhouzi, a famous Chinese science writer, who lives in the US right now, tweeted the functions of the app people found out through testing:
.
The app can read your contact, call from your phone, read your SMS and phone numbers, can display messages on other apps, can modify or delete contents on the storage, can receive SMS, record audio, read recorded messages, access camera, read files and your mobile network setting. It can obviously also modify your system setup.
Fang Zhouzi said: this is worse than monitoring, it is remote controlling.
So, you can imagine some people are pushing back.
One of the reasons is very practical: The user said that after he upgraded his Xiaomi phone OS, the app is taking too much of the battery.
.
Another reason, is that they are worried that the app might monitor them, according to Xiaomi. This Weibo exchange between a Xiaomi user and the official Xiaomi Weibo went viral.
The Xiaomi user said: “I heard that the miui13 has a build-in app of the national center of anti-fraud . Looks like this will be my last Xiaomi, and I will never upgrade it. “
Xiaomi responded: “MIUI13 does not have a build-in app of the national center of monitoring , please don’t spread rumours.”
The Xiaomi user responded: “Did I say the word monitoring ?”
“Is there an app of the national center of monitoring ? If so, I don’t ever want to buy any cell phone of domestic brand. “
Someone else responded: “It is not a MIUI13 build in. This thing will not be there during system upgrade. Perhaps it will get there one morning because some app gets updated.
The Xiaomi user replied: “I don’t want to be listened. I start to like the flare bomb feature.”
Xiaomi flare bomb refers to the function Xiaomi provides in MIUI11 and later that records the history of usage of apps on the phone. ( 应用行为记录 aka App Behavior Records )
(Curious Xiaomi phone users might want to take a look at Xiaomi ADB/Fastboot Tools)
This conversation happened just a few days ago. People are worried about this app that the government has mobilized its power to push to people’s cell phone.
Today, the Government runs a video compaign with a police in uniform asks:
“Why don’t you trust your government with your privacy?”
“Xiaomi did not have this app as a built-in, they just send data to the server of the center.”
“As long as you did nothing illegal, what is there that you want to hide from the government?”
Sounds familiar?