Fraudsters make hay from uncertainty on bourses

As Wu Zhen'an was anxious about the tumbling Chinese stock market in recent weeks, he was initially pleased to receive a call that appeared to help him try to recover his fortunes.

"The caller talked about several stocks and asked whether I wanted to buy them. To my surprise, what he said tallied with my purchases," said Wu, from Nanjing, capital city of Jiangsu province.

Then, the caller analyzed the unstable stock market and introduced his rich trading experience to Wu, asking whether he needed his help.

"But as he promised I would not have any losses with his assistance and he would charge me fees, I quickly hung up," Wu said.

Lu Shaoyang, an employee of a securities company in Beijing, echoed Wu, saying that he had been the recipient of such calls, which appeared to be an example of telecom fraud.

He said that he had received similar calls on a very regular basis, especially when the stock market was experiencing severe fluctuations.

"I have no idea who is calling me, and how do they know about my trading behavior?" asked Lu, adding that he always ignored them.

However, some investors are not so careful. According to a report on fjsen.com, a major website in Fujian province, an investor there surnamed Lin was stung to the tune of 60,000 yuan ($9,670).

Lin became a member of a website which claimed it could help investors trade stocks and ensure they got a profit, the report said.

"I trusted the website, which claimed that many investors had made money thanks to it, as I also wanted a return on my capital," the report quoted Lin as saying.

However, the website continued to ask Lin to remit money instead of giving him his capital back, and he then called the police, it said.

When the police told Lin the website was a fake, he realized that he had been cheated and his money would never be returned, the report said, adding that the case is still under investigation.

Wang Jiang, a lawyer specializing in fraud cases at Beijing Dongyuan Law Firm, said fraudsters are likely to be more active when there is a great deal of anxiety among investors.

Fraudsters in the capital market will be criminally punished if the amount of money they cheat from people reaches 3,000 yuan, according to Wang.

He suggested that investors should not trust the so-called inside information in the calls, as it is actually illegal to offer such information in the first place.

In addition, it is a good idea to make further enquiries about the "company" when receiving such a call, by searching for it on the official website of the China Securities Regulatory Commission, "which can easily help investors confirm whether the caller is genuine or not", he said.