Central Bank of China Issues Warning of DC/EP Fraud

China’s Central bank, the People’s Bank of China along with two other regulatory authorities has issued a warning regarding investment fraud and pyramid schemes through Digital Currency Electronic Payment backed by the central bank. 

The warnings suggest that a so-called DC/EP learning group has been set up by some lawbreakers who claim private institutions and commercial banks are working collaboratively to promote the DC/EP. They also tell their potential investors that if they buy the digital currency and then assist the company in promoting it by spreading the word among their friends, they will be eligible to get an extra layer of benefits from the private company. 

People’s Bank of China said that those criminals with fake company will escape after collecting investments from the victims. Another type of scam about which the regulators are warning is disguising digital currency products Central Bank-backed DC/EP. Then the fraudsters use that to lure the investors to take part in the trading of such products through the trading platforms of digital assets. 

China’s central bank issues notice warning of fraud using the name of DC/EP https://t.co/cXKtNZs6jy

— Danfe TV (@DanfeTv) March 17, 2021

There are some types of frauds that involve sending links to investors. These links are sent through messages and it claims that through this link, investors will be able to register for DC/EP. The notice also explains that the link requires consumers to top up a designated bank account to continue the registration procedure. 

The People’s Bank of China has issued a warning for the people and investment companies to be vigilant in downloading any unauthorized digital yuan application. They must only trust the official channels while investing in digital currency. 

“Digital yuan is legal tender that is equivalent to banknotes and coins. Any mention of using digital yuan to make money, return money or participate in digital yuan exchange is all fraud,” the notice read.

Multiple DC/EP public trials have been launched in multiple cities of China including Shenzhen, South China’s Guangdong Province, Suzhou, East China’s Jiangsu Province, Beijing, and Chengdu, Southwest China’s Sichuan Province.