Suspects arrested over fraud case

Police said eight Nigerians in China and a Chinese woman made more than 2.4 million yuan ($377,000) by posing as business suppliers and persuading foreign companies in the country to route money to the suspects' bank accounts.

The investigation, which involves two criminal gangs, has been completed, and the suspects have been transferred to the prosecuting agency, police said on Wednesday.

Lu Wei, deputy director of the anti-organized-crime division of the criminal investigation department of Shanghai Public Security Bureau, told China Daily: "This is a cross-border Internet fraud case involving the largest amount of money and the largest number of suspects nationwide in recent years.

"But the criminal organizations are of a clear structure, and the ringleaders are out of China. We've reported the case to some African and European countries and Interpol," he said.

Since November, Shanghai police have received more than 40 reports from US and European companies' mainland offices about their payments to Chinese suppliers disappearing after they were told to send their payments to a different bank account.

Police later found the e-mail accounts of both the suppliers and buyers were attacked by hackers. Lu said the suspects found the e-mail addresses of foreign trade corporations on e-commerce platforms such as alibaba.com, where such companies usually publicize themselves, according to Lu.

The suspects would steal the companies' user names and passwords via hacking, and they would be able to see e-mail exchanges about business deals and know when they had agreed to pay for products.

The suspects would disguise themselves as suppliers and send an e-mail to a purchaser, saying: "We've changed a salesman. Please send money to a new bank account."

"We usually don't doubt the authenticity of e-mail messages as we've been cooperating for years. And confirmation by phone calls are usually avoided because of the time difference for us and the overseas buyer," said the head of a Shanghai-based foreign trader of gemstones and a victim in the case. He spoke on condition of anonymity.

The suspects did not intend to commit crimes when they came to China, according to police, but they later found that an easy way to get rich.

"The task of most of the suspects we arrested was to open bank accounts with fake passports, which are used to receive money from the frauds, and take out the money from an account whenever a fraud was completed," said Ding Zhidong, chief investigator of the case.

"A suspect got 10 percent of the money as commission each time, and the value of each trade ranged from tens of thousand of yuan to several million," he said.

Most of the accounts were opened at Bank of China because it is well-known overseas. Ding said it is difficult for banks to verify whether foreigners' passports are fake.

The suspects were eventually targeted by police because of a bank account they referred to in e-mail, and police monitored those who withdrew money from the accounts.

The Chinese woman is the wife of a Nigerian suspect in the case. All of them are in their 20s and 30s. They will each face jail sentences of at least six years, Ding said.

Now that firms are more involved in international deals and frauds have occurred, police and experts are reminding companies to be cautious of any change in online deals, especially when it comes to payment.

"Communications of business deals on the Internet no doubt raises risk for companies who no longer make deals face-to-face," said Su Kaixin, a Shanghai-based lawyer who specializes in international commercial disputes.

"It could pose more dangers pertaining to money transfers, identity confirmation of the other party and the leaks of business information online," he said.

zhouwenting@chinadaily.com.cn