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March 15, 2016

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CBRC curbs number of bank accounts in fraud crackdown

THE Chinese banking regulator has curbed the number of personal bank accounts opened by individuals as it cracks down on possible bank fraud from lenders’ Internet-related business.

The number of accounts a user may open at one commercial bank should be limited to four instead of unlimited previously, the China Banking Regulatory Commission said in a statement published on its website yesterday.

Banks can suspend services to users who hold more than four accounts, especially those “which is not opened based on clients’ own willingness,” the CBRC said.

The restriction was imposed to curb activity of so-called zombie accounts, which are used by scammers to laundry victims’ funds defrauded through short messages, phone calls and e-mails.

“We will focus on reviewing accounts that are opened on behalf of others,” a spokesman at a commercial bank said.

Around 82 percent of bankcard holders used mobile banking to make payments and one eighth of them encountered Internet-related fraud in 2015, said an annual security report released by China UnionPay Co in December.

The number of frauds was 6 percentage points up from 2014.

The CBRC also asked banks to tighten their review on client identity, and urged closer ties with police on tracing funds that were transferred by swindlers.

Banks have been following the CBRC instruction after receiving its notice in January, spokesmen for commercial banks in Shanghai confirmed.


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