Iphone Users Warned Of ID Theft In China -- WSJ
October 12 2018 - 3:02AM
Dow Jones News
Payment companies say security breach led to loss of funds;
Apple is urged to act
By Stella Yifan Xie in Hong Kong and Yoko Kubota in Beijing
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (October 12, 2018).
China's two mobile-payments giants said stolen Apple IDs were
used to swipe customer funds, and called on Apple Inc. to address
the issue.
Alipay, the payments affiliate of e-commerce giant Alibaba Group
Holding Ltd., in recent days posted an online notice warning iPhone
users, and saying some customers had lost money as a result.
Alipay said it has asked Apple "multiple times" to pinpoint how
the thefts occurred, and that the Cupertino, Calif.-based company
replied it is looking into the matter.
An Apple ID refers to the account used to access Apple services
such as its App Store and iCloud. It includes information such as
the user's email address, password and payment details, according
to Apple's website.
Some Chinese iPhone users complained in recent days that they
received mobile notifications of App Store spending they didn't
authorize, according to state media China National Radio.
Complaints on social media claim losses amounting in some cases to
hundreds of U.S. dollars, with text-message notifications at odd
hours.
Alipay's notice didn't say how many people had been affected,
but said they did include iPhone users who connect their accounts
to other payment systems, including its main rival WeChat Pay as
well as credit cards. A spokeswoman for WeChat Pay, owned by
Tencent Holdings Ltd., said it didn't issue a notice to users, but
a company statement to the media echoed Alipay.
Both Alipay and WeChat Pay hold billions of dollars of customer
funds in escrow to facilitate mobile and online transactions.
An Apple spokeswoman pointed to instructions on its website for
protecting Apple IDs against fraud -- such as two-factor
authentication, a setting that requires users logging in to verify
their identity with a second code in addition to a password.
Alipay's online notice warned customers are "exposed to risks of
financial loss" until Apple resolves the issue, and said they could
minimize losses by reducing the amount that can be transferred
without entering a password. It also included Apple's China
customer-service number.
The brouhaha has emerged during a week when Apple CEO Tim Cook
is in China meeting with employees, government officials and
others.
Alipay, owned by fintech giant Ant Financial Services Group, is
China's largest mobile-payments system by transaction volume,
slightly ahead of WeChat Pay. Alipay had 700 million users as of
August; WeChat Pay, more than 800 million users as of June.
Between them they handled nearly $15 trillion in mobile
transactions in China last year, according to data firms iResearch
and Analysys. Both systems are widely used for everyday services
like bus and taxi rides, meals and online shopping, utility bills
and even to invest in mutual funds.
Some consumers in China prefer Apple devices -- including the
iPhone -- and services over those of its Chinese rivals running on
Android because they consider the company's privacy protections
tighter.
Write to Stella Yifan Xie at stella.xie@wsj.com and Yoko Kubota
at yoko.kubota@wsj.com
(END) Dow Jones Newswires
October 12, 2018 02:47 ET (06:47 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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