Criminal networks operating out of China have made more than $1 billion in the past three years by bombarding Americans with fraudulent text messages that trick recipients into handing over credit-card data, according to the Department of Homeland Security (DHS) — and investigators warn the schemes are now highly industrialized.
The scams, commonly called “smishing” (SMS phishing), typically alert victims of an unpaid toll, U.S. Postal Service fee, or traffic violation and direct them to a fake website where they are asked to enter payment information. Once thieves capture the card data, they exploit it to buy physical goods and gift cards — often using a multilayered international operation that funnels proceeds back to criminal groups in Asia.
According to reporting in the Wall Street Journal, the syndicates behind the texts have refined each step of the fraud into an efficient, transnational pipeline that includes bulk text-delivery systems, stolen-card provisioning in digital wallets, and local “mules” based in the United States who complete the transactions.
How It Works
Mass texting via SIM farms. Criminals use so-called SIM farms — rooms packed with hundreds or thousands of inexpensive SIM-card-equipped devices — to send millions of identical text messages from rotating phone numbers. A single operator using a SIM farm can send volumes of texts that would otherwise require a thousand individual phones. At least 38 SIM farms have been identified operating in the United States in cities including Houston, Los Angeles, Phoenix and Miami. Many of the farms are run remotely from abroad but set up on American soil by workers recruited through apps such as WeChat.
Phishing sites and keystroke capture. When a recipient clicks a link in a scam text, it leads to a spoofed payment page. The phishing pages — often created using software distributed through Telegram channels — can log every keystroke so criminals immediately capture a victim’s name, account number and CVV.
Card provisioning and mules. Stolen card numbers are loaded into Google Pay and Apple Wallet accounts in Asia. The scammers then recruit hundreds of U.S.-based “mules” via Telegram channels to make purchases on their behalf using remote tap-to-pay software that links their phone to the criminal-controlled wallet. Mules typically receive a small fee — reported around $0.12 per $100 in gift-card purchases — while the goods or gift-card credits are shipped back to China to be resold.
Conversion to cash. Purchased electronics, clothing and gift cards are shipped overseas and sold, or exchanged through secondary markets, generating proceeds that feed back to the criminal organizations.
Scale and recent enforcement
The volume of the texts has surged. Cybersecurity firm Proofpoint recorded an all-time high of 330,000 toll-scam messages in a single day last month, and says the average monthly volume of such messages is now roughly 3.5 times what it was in January 2024.
American law enforcement has made several high-profile seizures. In September the Secret Service uncovered a SIM farm in the New York area containing more than 100,000 SIM cards and 300 servers, which agents linked to swatting attacks and other criminal activity.
The DHS assessment, combined with reporting by the Wall Street Journal, underscores how the business model spans continents and technologies, implicating not only the initial scammers but also networks of domestic facilitators and international logistics.
Consumer impact and warnings
Victims of the scams have reported drained accounts, unauthorized charges, and difficulty getting refunds. State departments of motor vehicles in New York, Florida and California have issued warnings about a marked uptick in fake toll and traffic violation texts purporting to be official communications.
Cybersecurity experts and law enforcement officials advise consumers to:
- Never click links in unsolicited texts about fines or fees.
- Verify directly with the agency or company through official websites or phone numbers.
- Enable bank and card alerts and monitor statements closely.
- Use card controls and virtual-card features where available for online purchases.
- Report scams to the FBI’s Internet Crime Complaint Center (IC3) and to your card issuer immediately if you think you’ve been targeted.
Law-enforcement challenges
Prosecutors and regulators face several hurdles: the operations are transnational; infrastructure can be rented or reconstituted quickly; and the schemes blend cutting-edge digital tools with low-cost human labor recruited through encrypted messaging apps.
DHS officials say investigations are ongoing and that the department is coordinating with the Secret Service, FBI and international partners to disrupt the SIM farms, the mule networks and the financial conduits that move illicit funds.
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Yes, this problem is huge, and the easiest way to help Americans is to find and quash the Sim card Farms. Moreover, the last time one of my bank cards was “stolen” was at one of the DMV offices in Southern California, and they spent thousands and thousands over 4 weeks despite repeated requests from me to the bank’s fraud department to shut down the use of the card. Money is used to buy everyone in the chain, and when these scams are primarily running from China, then we know how easy it is for China to use all of the Chinese located in America for their own fraudulent purposes. CCP owns the Chinese anywhere they are located.
Delete all scam Texts from phone
Nuke the CCP! End this shyt!