Mainlanders indicted on illegal UnionPay transactions

Judiciary Police have busted another unauthorised UnionPay transaction scheme, in which four mainlanders were arrested.
They were suspected of committing computer fraud and the case has been handed to the Public Prosecutor’s Office.
Police revealed that the group had been operating for at least nine months; they made cashback transactions of more than 102 million yuan, costing UnionPay more than 250,000 yuan.
The police said they were tipped off that the suspects were illegally assisting people to make unauthorised cashback UnionPay transactions in a hotel room in Coai. Police narrowed down the targets after intelligence analysis and launched an operation on the afternoon of 25 January. In a hotel room, four people were arrested and the police confiscated four illegal UnionPay mobile card swipe devices, mobile Internet devices, and 50,000 yuan in cash.
The investigation also revealed that two individuals were in charge of providing cash and the devices, while the other two escorted clients to the hotel rooms to make the cashback transactions. The police said that they did not rule out the possibility that more people are behind the scheme and still at large.
The police said that the suspects were using mainland-based unauthorised UnionPay terminals in Macau to profit from the difference between the service charges. Using a 10 million yuan cashback transaction, for example; if it’s made on the mainland network the service fee would be 26 yuan but if the transaction is made via a Macau UnionPay network, the service fee would be 1.4 per cent of the amount transacted which would reach 140,000 yuan. The suspects charged their clients the usual service charge for transactions made on the Macau network and profited from the margin.
However, the multibillion dollar illegal cash transfer business is being used in Macau widely to circumvent China’s strict money transfer controls, allowing gamblers access to more  cash.
The daily limit that individual Chinese can legally move out of the mainland is 20,000 yuan in cash. The scam involves a cash transfer through a mobile swipe device, usually disguised as the purchase of watches or jewellery. With the POS (point-of-sale) machine registered on the mainland, the transaction appears to have been conducted outside of Macau.