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POS machine swindler gets 8 years in jail
By Xu Fang |
October 20, 2010, Wednesday
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Online Edition
Online Edition
A businessman has been sentenced to eight years in prison for using his companies' POS machines to draw out 58 million yuan (US$8.68 million) in cash for credit card holders and earn commissions, judges said today.
Two women who helped the man surnamed Zhou in the scheme were both sentenced to three years in prison with probation of three years by the Zhabei District People's Court.
Zhou registered Canhai Company in February 2008 and applied for a POS machine from a bank. At first, he did business normally while he soon found quite a few private company owners offered POS machines for credit card holders to draw cash and earned money easily.
He then registered two other companies and got two more POS machines. Besides, he borrowed another machine from a friend.
The illegal account settlement business started in May 2009. Zhou rented an apartment on Haining Road and hired his ex-wife surnamed Tang and a woman surnamed Pan to help.
Zhou worked to develop more clients and the two women were in charge of drawing cash for clients.
Credit card holders who needed cash asked Zhou to make fake deals and paid via cards. Zhou then returned the payment in cash to the holders and charged commissions ranging from 1 to 2.5 percent of the payment.
In this way, credit card holders can get interest-free loan and Zhou can earn commissions from both the clients and banks. Banks are the only victims in the scam.
When Zhou was caught on April 17, the trade volume made by the four POS machines had accumulated to more than 58 million yuan.
Two women who helped the man surnamed Zhou in the scheme were both sentenced to three years in prison with probation of three years by the Zhabei District People's Court.
Zhou registered Canhai Company in February 2008 and applied for a POS machine from a bank. At first, he did business normally while he soon found quite a few private company owners offered POS machines for credit card holders to draw cash and earned money easily.
He then registered two other companies and got two more POS machines. Besides, he borrowed another machine from a friend.
The illegal account settlement business started in May 2009. Zhou rented an apartment on Haining Road and hired his ex-wife surnamed Tang and a woman surnamed Pan to help.
Zhou worked to develop more clients and the two women were in charge of drawing cash for clients.
Credit card holders who needed cash asked Zhou to make fake deals and paid via cards. Zhou then returned the payment in cash to the holders and charged commissions ranging from 1 to 2.5 percent of the payment.
In this way, credit card holders can get interest-free loan and Zhou can earn commissions from both the clients and banks. Banks are the only victims in the scam.
When Zhou was caught on April 17, the trade volume made by the four POS machines had accumulated to more than 58 million yuan.
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