The virtual money scam crisis intensifies, making it difficult for the public to recover their losses? Blue Committee calls for strengthened regulation!

Surge in fraud cases! Financial losses from scams in October approaching last year's total.

The problem of fraud in Taiwan continues to worsen and has become a major social concern. Kuomintang legislator Zhang Zhilun held a public hearing on 'public-private cooperation to combat fraud' in the Legislative Yuan on November 26. During the meeting, it was pointed out that fraud cases in October this year resulted in a loss of up to 12 billion NT dollars, an increase of 3.2 billion NT dollars compared to the previous year, which is shocking. According to the 'Fraud Dashboard' of the Ministry of the Interior and the National Police Agency, a total of 18,094 fraud cases were reported in October, with an average daily loss of 550 million NT dollars. These astonishing figures not only raise concerns but also highlight the urgency of the government's anti-fraud policies.

Image source: Anti-fraud Dashboard. In October this year, fraud cases suffered financial losses of up to 12 billion yuan.

Last year, the total amount of fraud in Taiwan reached 8.878 billion yuan, of which Virtual Money fraud accounted for 5.3 billion yuan. However, data from October of this year shows that the fraud problem has not improved but has intensified. Zhang Zhilun questioned: 'Why does anti-fraud lead to more fraud?' He pointed out that the anti-fraud budget for the next year has reached 7.35 billion yuan, an increase of 4.8 times over this year, but the effectiveness has not improved significantly.

Legislators sharply criticize: recovering the money is urgent for public-private cooperation.

Legislator Wu Zongxian bluntly stated that from 2022, over 80% of the defrauded amount cannot be recovered. He criticized that the majority of illegal gains are quickly laundered through foreign Virtual Money companies, and the government lacks effective supervision of overseas exchanges. According to Wu Zongxian's investigation, among the Virtual Money operators who have made 'anti-money laundering declarations', there are 26 domestic companies and 1 foreign company. However, it was found that the company registered in the British Virgin Islands (BVI) is actually a Taiwanese company, which means that the government does not actually have any control over any foreign Virtual Money company.

What is even more worrying is that the Anti-fraud Command Center of the Executive Yuan claimed to have returned 2.4 billion yuan from June last year to October this year, but the actual settlement situation is questionable. Wu Tsung-hsien pointed out that in practice, it is common to make the first two payments after reconciliation, but then fail to follow up, so there may be a 'water-filling' element in this digital figure of 2.4 billion yuan.

Legislator Lin Peixiang also quoted Nobel laureate Paul Krugman's view, describing fraud as a high-value criminal industry. He emphasized that relying solely on the public sector to prevent it is not enough, and it must be addressed from multiple dimensions such as law, technology, and finance. Legislator Ge Rujun also pointed out that over 70% of Virtual Money users in Taiwan use Cryptocurrency through overseas exchanges, demonstrating the urgency of regulation.

Source: United Daily News. KMT legislators held a public hearing in the Legislative Yuan, calling for strengthened regulation of Virtual Money.

Government Response: Simultaneously Promoting the Formulation of Anti-Fraud Guidelines 2.0

In the face of rampant fraud, the Anti-Fraud Command Center of the Executive Yuan stated that it will combine law and technology to expedite the completion of the sub-laws of the 'New Four Laws Against Fraud'.

The command center emphasizes that it is formulating the "Anti-Fraud Guidelines 2.0", which will address various aspects: preventing the abuse of Financial Service, blocking illegal use of telecommunications services, regulating the digital economy industry as a channel for fraudulent information, and severely punishing fraud crimes.

It is worth noting that, according to the command center, based on the report of the Global Anti-Scam Alliance (GASA), more than 40% of Asian people encounter scams every month. They believe that the current scam data and amounts rise are the pain points in inhibiting and controlling the scam process. If there is a lack of strong government prevention and crackdown, the situation will be even more severe.

The anti-fraud work will be jointly carried out by multiple departments: the Ministry of the Interior is responsible for the public awareness and education aspect of anti-fraud, the National Communications Commission handles the telecommunications service aspect, the Ministry of Digital Development focuses on the digital economy aspect, the Financial Supervisory Commission is responsible for the flow of illicit funds, and the Ministry of Justice is dedicated to investigation and combating fraud. The departments will work together to achieve the best results in effectively suppressing fraud.

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"Virtual Money fraud crisis intensifies, difficult for the public to recover financial losses? Blue Committee members call for strengthened regulation!" This article was first published in "encryption City"