The China Banking and Insurance Regulatory Commission (CBIRC) has issued a directive warning consumers to be wary of fraud involving fake insurance agents selling wealth management products (WMP’s).
The “Risk Reminder Concerning Awareness of ‘Insurance Dividend’ Fraud” (关于警惕“保险分红”骗局的风险提示) was issued by CBIRC on 23 May, warning consumers to beware of fraudsters convincing them to withdraw from their current insurance policies to purchase other investment products.
The Reminder says that fraudsters in China are frequently posing as insurance agents, and using the pretext of “insurance policy dividends,” “insurance policy upgrades,” free gifts or after-sales services to make contact with consumers.
Fraudsters reportedly then disparage the value of the insurance products that consumers have already purchased, before convincing them to withdraw from these policies and instead invest in high-yield wealth management products (WMP).
“This conduct very likely involves fraudulence or illegal fund-raising, severely threatening the security of consumer funds” said the directive.
“CBIRC reminds consumers in general to raise their awareness of this conduct.”
