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FBI warns on the Chinese embassy scam, losing a total of tens of millions of dollars

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The Oregon office of the FBI has an advisory this week on a ongoing scam that has resulted in a loss of a total of tens of millions of dollars.

The office posted an advisory, “Building a Digital Defense Against the Chinese Embassy Scam, based on a public announcement from the FBI’s Internet Crime Complaint Center (IC3).

The scam has been effective. More than 15 months, victims have reported losses of a total of $40 million, the IC3 reported earlier this year. The average loss is $164,000 per victim.

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In one version of the scam, victims are contacted – often in a Chinese dialect – by a “spoofed” phone number, sms or chat application. The scammers claim to be from the Chinese embassy or consulate. Sometimes victims are told it is a shipping company and be told to claim a package.

In other variants of the scheme, a scammer, says the victim’s passport, social security card or credit card was found in a package or on a “suspicious person.” Other scammers posing as Chinese credit card companies that outstanding payments and tell the victims to work with Chinese law enforcement to solve the problem.

The scammers then ratchet up the list by the transfer of victims “researchers” that suggest that they amount to accounts in China or Hong Kong. In some cases, victims may be asked to pay via credit card or virtual currency.

“If the victims do not cooperate, they are threatened with deportation, loss of assets and/or the prison,” the IC3 said in the PSA. “If victims do not have the requested funds, the scammers may ask them to obtain a loan. They can also be asked to check in on a daily basis through an online chat application until the payment has been done,” the FBI said.

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Ransom demands are also in some cases. Scammers may claim to be the victim’s relative was kidnapped. “The criminal actors are then in a position to extort money from both the original victims and their families,” according to the FBI.

Most of the victims names of Asian origin and were often students or attending a university faculty of China, the FBI said.

To verify that the caller is legitimate, the FBI sets the find of a available to the public number of the caller alleged organization or company, and then independently make a call to that number itself back. Also, “be careful when you are asked for a situation or case secret. This is a red flag,” the FBI said.

The Chinese government has indicated that they are not to have contact with people over the telephone “to personal information, parcel pick-up, bank account information, or to answer questions of the local Chinese law enforcement,” the FBI said.

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