Chinese authorities warn of rising fraud linked to the digital yuan

Authorities in the Xiongan district warned residents about rising cases of fraud involving the digital yuan (e-CNY). The criminals impersonate government officials to gain access to victims’ funds.

The district administration stressed that e-CNY is “in an experimental stage of development.” Users were advised to download digital wallets only from verified sources such as sites of authorised banking institutions.

The authorities cautioned citizens against scammers who, posing as prosecutors or police officers, attempt to access bank card details, passwords, and also urge them to download suspicious software.

The digital yuan is a legitimate payment instrument, equivalent to cash. Any proposals involving the use of e-CNY to obtain profits or invest in ‘digital yuan exchanges’ are fraudulent, the notice says.

Earlier, Chinese law enforcement authorities arrested a woman suspected of a $47,000 e-CNY scam, according to Bloomberg. In early November she called the victim and, posing as a police officer, extorted personal data, including the ID card number, bank account details and a photo of the face.

The suspect registered a wallet for the digital yuan in the victim’s name and transferred funds from the bank account to it. After that she withdrew the stolen money to her own electronic wallet.

Xiongan became one of the first districts in China where the authorities conducted trials of e-CNY.

As of October 2021, about 140 million people had opened wallets for the digital yuan and used it for transactions totaling around 62 billion CNY (~$9.7 billion).

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