You Are One Guessed or Stolen PIN Away from Disaster: Be Careful With Your ATM Card in China (or Anywhere)

A friend of mine in Shanghai just had 9000 RMB (US$1500) stolen from his Korean bank account by somebody using his ATM card number in Poland. His bank is unsympathetic. They claim that he must have given his card or PIN number to somebody and that is how they  took the money out. But he never gave it to anyone, though someone may have rigged an ATM machine to read his info.

Your ATM card is a disaster waiting to happen. If someone gets your number and your PIN, by theft or guesswork, you may have no recourse. You must limit the use of your card to avoid having thieves scan it and not keep too much money in any account that can be stolen using an ATM card.

Whenever you use your card with a retailer, there is a chance that the retailer is keeping your PIN, perhaps inadvertently, and this PIN can then be hacked and sold to thieves. See the 2006 story from NBC News which explains some of the basic threats.

The more you use your card, the greater your risk. The more money in your account, the greater your risk. Keep some of your money in accounts that cannot be accessed with an ATM card using the terribly inadequate 4-digit PIN security system.

Surprisingly, money may be swiped from your account using your ATM card number even if the thieves don’t know your PIN number. Sound impossible? Our experience proves otherwise.

Recently someone in Germany started pulling about $300 a day out of our US bank account using our ATM card number from our US bank. This is a card we rarely use–I think we have never used it China but did use it on our trip to Italy in February 2014. the thieves struck in May 2014. They took the most they could each day for 3 days in a row before I happened to check my online bank account and notice the unexpected withdrawals. It was very fortunate that I noticed this right away instead of after our account was drained dry. Amazingly, there was no anti-fraud alert to the surprise bleeding that was underway. Bet they could have taken everything if I hadn’t noticed.

I immediately called the bank and they inactivated the card. Whether I would get the money back or not depended on one thing: did the thieves use my PIN number when making the withdrawals? If they had, then the money would be lost forever. No recourse. But because the bank in Germany that dispensed the money was not able to provide proof that the PIN had been used, my bank ruled in my favor and refunded the money.

How the thieves got money out of my account without my PIN was never explained. But it did happen, so it seems, and that means it can happen–to you! Check your account often for fraudulent charges. Use your card as little as possible. Don’t use it in shady locations–whatever that means. Assume every operation is shady and vulnerable. Guard your PIN zealously and watch for unusual attachments to ATM machines, and realize that people may be watching the keys you push, so cover the keypad and use false moves as well.

On the other hand, when PINs are just 4 characters long, someone could simply guess the PIN after enough tries with enough cards (several tries each on a thousand or more cards) and then they have a money machine. The chances of someone guessing your PIN on the first try are just 1/10,000. After 10 tries, though, it’s 1/1000. How many people have been trying to guess your PIN? Does your bank every tell you? Probably not. Your card might get inactivated with lots of bad guessing–a huge inconvenience, but better than losing everything. Check with your bank and understand their anti-fraud systems and what recourses you have to fraudulent withdrawals.

Remember, you are just 4 numbers away from disaster, and those numbers can be stolen or possibly even guessed.

By |August 18th, 2014|Categories: Consumers, Finances, Products, Scams|Tags: , , |Comments Off

Prepare For Your Trip to China With Scam-Prep 101: Beware the Karaoke Scam, the Tea Ceremony Scam, and Other Scams in China

I’ve written before about the dangers of the “Tea Ceremony Scam” in China where attractive girls or other friendly young people invite foreigners to join them as they attend a nearby traditional Chinese tea ceremony. After a few tiny samples of tea, you’ll be billed for hundreds of dollars, and there might be some tough muscular guy there to enforce payment. This scam is actually dangerous, and if you fall for it, you’ll literally be in a den of criminals. It’s one of the most common scams in China.

It is important to know that there can be several variations of this scam. An important variation has come to my attention with the recent news story in the Shanghai Daily, “15 members of karaoke crime gang detained” (June 24, 2014). In this scam, friendly people invited victims to join them in karaoke. After some entertainment, a bill was presented for something like 30,000 RMB (US $5,000). In the case in the story, the man paid $1,000, everything he had, but this was not enough, and they were forcibly taking him back to his hotel to get the rest of his money. He managed to escape on the way and get help from the police, who eventually captured the gang. But there are probably many similar gangs in operation.

Whether you are in Shanghai, Beijing, or any other place that gets significant tourism, you have to be wary of friendly strangers who want to invite you somewhere. Don’t go with them. Don’t let merchants or others lead you down isolated alleys or remote floors of buildings to see their mystery shop. Don’t let them lead you into a room where they can lock the door to prevent you from escaping–something that happened to someone I know well. Fortunately for her, they were just keeping the police away from their fake goods operation, and the woman was able to get out unharmed. But don’t take those risks. Avoid the scams in China, but recognize that the scammers can be very polished, alluring, and highly trained–they are part of a well-oiled scam machine run by real professionals who have mastered effective systems that keep duping foreigner after foreigner, making loads of money for the scamlords.

Be alert. Make sure he change people give you is real Chinese money. Make sure the expensive product you buy is actually put int he package. Make sure the cab you get into you is a real cab using a real meter. If the meter is off and they quote you a price to get to your destination, don’t accept that unless you know what the real price is and it is close enough to be acceptable to you, otherwise you can many times the real price. Don’t prepay for rides because you might get dumped off for some other low bidder to take you, only to find additional fees on the way (yeah, I experienced that).

When you’ve been robbed by falling for a scam, you’ll feel really stupid and pained by how you were used and cheated. That’s a lot of stress that you can avoid in many cases by being alert and reducing your risks.

The Chinese people are generally honest, friendly, and decent, but the handful of exceptions are the ones who will be watching for you. They are organized and know you are coming. Be ready and stay safe.

 

 

By |June 27th, 2014|Categories: China, Scams, Shanghai||Comments Off

Another Scam in China: Worthless Foreign Currency (and One More Sip of the Popular Tea Scam)

Thailand-currencyAn American friend of mine visiting Shanghai was shopping at Yu Yuan (Yu Gardens) and bought something from a pushy salesman on the street. He paid with a 100 RMB bill and was given several bills as change. What he didn’t notice was that the  bills he received was worthless currency from some foreign nation (he thought it looked like Arabic but I’m guessing it was from Thailand). So instead of paying 20 RMB, he paid 100. Rip off.

Make sure you know what real Chinese currency looks like so people won’t had you bogus currency for change. Look, verify, and count. Don’t be so trusting and gullible, like many of us Americans are.

Other Basic Scams at Tourist Attractions 

The day before my friend went to Yu Yuan, I warned him about some of the scams he might encountered. I told him that anytime someone approaches you there or at other major tourist sites and speaks English to you, no matter how friendly and attractive they may be, they are probably sales people whose job is to separate you from your money. I warned him that there are people who try to engage foreign visitors by asking them to take their photos, and then some sort of scam is likely to follow. Just say no politely and walk away, I said. I also warned him of the ever-popular and often successful tea ceremony scam, where gullible foreigners are lured by attractive English speaking girls to join them at a traditional tea ceremony for a cup of tea. In this scam, after a few minutes of tea, a gargantuan bill is presented, accompanied with solid Chinese muscle to enforce payment for what was allegedly a rare and exotic high-priced tea. One cup might cost you hundreds of dollars. Never fall for that, I warned. Stay away. Beware. Don’t go inside.

The next day at Yu Yuan, my friend ran into a couple of cute girls who spoke English and asked if he could take their picture. Being friendly and always wanting to help, this young man took the photos and chatted with them. “We are tourists from Beijing,” they said, “and have been to all these major Shanghai attractions on our tourist map except for one, a traditional tea ceremony right around the corner. It’s a great way to experience Chinese culture. Would you like to join us for some tea?”

“Well, I guess I can just take a look,” he said, and followed them into a tea house. But eventually, he later told me, my warnings began to enter his thinking–finally–and he realized he had better check a menu and see what the prices were before he did anything. He asked for a menu and saw that there was a 30 RMB service fee posted in addition to some high prices for the tea. But now he felt pressure to not just walk away, though he explained he didn’t drink tea and needed to leave, so how much did he need to pay for just taking a look as he had done? The waitress was puzzled and went to check with the owner, and came back saying that he needed to pay 200 RMB. That’s for absolutely nothing–what crooks. He said no way and gave them 30 RMB as I recall and left, but they were angry. I think he was lucky the muscle hadn’t shown up yet.  The result could have been much worse.

When you see young people at Yu Yuan waiting with cameras at busy corners or on busy streets, and out of all the thousands of passers-by, they choose you, the stand-out foreigner, to get someone to take their picture, know that the last thing they want is your photographic assistance. It’s a scam. Feel free to take their photo on your camera so you can let others know who these scammers are, but don’t let them lure you anywhere. They don’t want photos, just your cash. Lots of it. And they will use deception and force if you give them the opportunity.

By |March 26th, 2014|Categories: China, Scams, Shanghai, Shopping|Tags: , , , , |Comments Off

Scams in China (and Beyond): Some Tips

There are many scams that newcomers here must learn to avoid. The classic scam involves English speakers inviting Westerners to come to a traditional Chinese tea ceremony. After a cup or two, there’s a bill for a huge amount, with some hefty bouncers there to enforce payment. Ouch.

Online shopping in China or with Chinese companies can be a big risk. Here is a list of Chinese retail websites that are reported to be fraudulent. One friend of mine bought a computer on one of these sites and lost his money. One of the warning signs that he should have known about: they told him they don’t accept credit cards but needed the money sent via Western Union. That’s the same as handing someone cash. No recourse. No protection. Don’t ever buy anything via Western Union payments! Ever.

If you are coming here for a job, there a plenty of crooks that will sign up foreigners for jobs here that turn out to be closer to slave labor. They promise to get a visa faster than should be possible, and some smuggle people into the country illegally or bribe an official at a “diplomatic desk” to get the victim into the country. They then keep the person’s passport, making the person completely vulnerable and at risk of imprisonment or deportation if they don’t cooperate, etc. It’s human trafficking. Don’t fall for these scams. They are aimed largely at people from less developed countries.

Remember, there are people looking for ways to exploit you. Be suspicious. Be nervous. Don’t give your passport to people you don’t trust. Don’t pay people in advance with cash. Don’t let a charming smile lure you into an out-of-the-way place where you’ll have to pay a lot for your tee, or pay even more to replace your teeth. China is a great place abounding in kind, honest people, but the few crooks here and everywhere else force us to stay on our guard at all times. Be careful.

By |February 11th, 2014|Categories: China, Scams, Shopping, Travel tips|Tags: , , |Comments Off