China Solved 258,000 Telecom Fraud Cases in 2025, Froze RMB 217.07 Billion; Stock Scams Pose Evidence Hurdles

Stock recommendation fraud has evolved into a highly covert criminal chain with clearly defined roles, spanning traffic acquisition, trust-building, deposit inducement, fake profits, withdrawal restrictions, and final harvesting before the perpetrators disappear. Fraud rings typically reach target audiences through stock trading live streams, social media platforms, and stock forums, using live interactions, comment replies, private messages, and proactive friend requests to attract victims. Some rings lower victims' guard by posing as charitable donors or offering free stock analysis. During the trust-building phase, fraudsters fabricate identities such as "chief strategist" or "brokerage analyst," set up fake discussion groups under the names of well-known brokerages, and invent concepts such as internal IPO subscription channels and main trading accounts, reinforced by forged official seals, cooperation agreements, and signing photos to enhance their credibility.

When it comes to transferring funds, fraudsters require users to abandon legitimate brokerage trading channels and download counterfeit private-chain apps or use overseas messaging tools to evade regulation. Funds are directed to non-standard recipients such as personal accounts and media companies, with explanations such as "third-party custody" or "tax optimization" used to mask irregularities. The backend servers, databases, and domains of fake stock trading apps are mostly hosted overseas, preventing regulators from directly logging in to retrieve transaction records and manipulation logs. When such apps are blocked, fraud rings quickly switch to new domains, installation packages, and backend ports to continue operations. The profit-and-loss figures and price movements displayed in the app backend are manually altered by the fraud ring, and police cannot verify transaction authenticity through securities clearing systems, relying instead on screenshots saved by victims. Once users uninstall the app or lose access permissions, transaction records are permanently lost.

Fraud rings operate with highly refined internal divisions of labor, comprising traffic, customer service, technical, and funds teams. Team members do not know one another, communicating only online and never meeting in person. The fund flow is extremely complex: after victims transfer money to designated bank accounts, the funds are quickly split across dozens of money-mule cards or third-party collection payment channels, then transferred layer by layer across regions, ultimately consolidated into overseas accounts through underground banks, cryptocurrency, and cross-border trade channels. In some cases, victims meet fraudsters through social settings, where the perpetrators build trust through daily conversation and show screenshots of high returns to induce app downloads. Some victims received anti-fraud center phone alerts after downloading and registering, followed by police home visits that prevented financial losses.

Fraud rings also induce victims to download apps through mobile app marketplaces. These apps pass review after simple repackaging, retaining chat functions to evade sensitive content screening. App store reviews rely primarily on static code scanning, and some apps are disguised as news or utility software at launch, making them difficult to identify in the early stages. Platforms can only identify and remove them after large numbers of victim complaints. Existing anti-fraud defenses include the National Anti-Fraud Center app, which offers caller risk identification, scam app detection and reporting, suspicious URL blocking, one-tap reporting, and fraud case education. It receives high-risk alerts from local police in real time, and linking family accounts helps protect elderly users and students. The 96110 anti-fraud hotline places dedicated calls to high-risk users, while the 12381 government anti-fraud SMS alert service, operated by the Ministry of Industry and Information Technology, sends bulk scam warning messages.

Community-level prevention employs a three-tier coordinated warning mechanism, with anti-fraud centers monitoring high-risk leads around the clock and dispatching them by severity to local police stations. Grid workers and community officers conduct door-to-door visits, focusing anti-fraud education on elderly people, stay-at-home mothers, and young job seekers, with emphasis on stock recommendation "pig-butchering" scams and click-farming fraud. Bank tellers who spot suspicious transfers can immediately alert police, who arrive to intercept and freeze payments, forming a "bank plus police station" joint defense. According to a Ministry of Public Security report in January 2026, police nationwide cracked down hard on telecom and internet fraud in 2025 under the Anti-Telecom and Internet Fraud Law and related regulations, solving 258,000 cases. The ministry launched special operations codenamed "Cutting Flow," "Pulling Nails," and "Severing Chains," arresting 542 financiers, ringleaders, and key operatives behind fraud syndicates. Working with relevant departments, authorities intercepted 3.6 billion scam calls and 3.3 billion scam messages, froze RMB 217.07 billion in scam-related funds through emergency payment stops, and conducted 6.747 million in-person warnings.