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May 11, 2010

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Cops nab 45 suspects in bank, credit card scams

FORTY-FIVE suspects have been caught for alleged bank or credit card scams last month with the total sum in the cases exceeding 1 billion yuan (US$146.5 million), Shanghai police said yesterday.

A total of 43 point of sales machines were found to have been poorly monitored, showing loopholes in management of such devices by banks.

The Shanghai Public Security Bureau said yesterday that illegal cash advances were becoming more common across the city.

Last month, three men were detained in Zhabei District for providing illegal cash advances through three POS machines.

The main suspect surnamed Zhou used three POS machines registered to his bogus trade company to give customers cash advances on their credit cards, police said.

Charging rates between 0.5 and 2.5 percent - banks charge 3 percent - Zhou and his company could earn thousands of yuan each day just by swiping credit cards.

"Those POS machines were all registered at trade companies that had no actual business," said Dai Xinfu, deputy director of the bureau's economic crimes unit.

Zhou and two of his accomplices were nabbed on April 17 in a building on Haining Road in Zhabei.

Dai said such crimes also existed in other places of the city as the police launched crackdowns in the districts of Xuhui, Yangpu, Songjiang and Fengxian as well as the Pudong New Area.

In Xuhui, more than 160 million yuan in illegal cash advances went through POS machines, Dai said, blaming the banks for loose supervision of the machines.

"Approval and settlement are usually operated by two departments in banks, causing a lack of supervision of the machines," Dai said.

Dai added that these illegal cash advances often are connected to other crimes such as drug abuse or gambling.

"Generally, most people don't need to get a large amount of money through the machines," Dai said. "Therefore, people using them could be suspects in other cases."

Police said that first-time offenders of the illegal cash advances will be warned, but an individual caught several times will be detained.

In a separate case, two suspects had been arrested in a bank card scam after purchasing the personal information of cardholders.

Police said the suspects purchased the client information of 2,000 cardholders at various banks. The two then hired telephone operators to pretend to be bank employees and call the victims. They earned the trust of victims with their personal information and lured them into buying fake-branded handsets at a "discounted price."


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