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<p>Telecom fraud is an escalating global concern, yet its household-level financial determinants remain insufficiently understood. Drawing on nationally representative survey data from China, this study investigates how household financial vulnerability influences both exposure to and victimisation by telecom fraud. The findings reveal a paradoxical pattern: financially vulnerable households are less likely to be initially targeted, yet once exposed, are significantly more prone to victimisation. Mechanism analysis identifies two behavioural pathways: lower financial literacy among vulnerable households reduces early exposure, while elevated risk preference increases susceptibility after contact. The results remain robust across alternative specifications and subsamples, with an instrumental variable approach employed to mitigate potential reverse causality. Heterogeneity analyses further show that households headed by men are more likely to suffer financial losses, and that those whose household heads are middle-aged, educated, and married face greater targeting risks. Larger households are less frequently targeted but more likely to incur losses once exposed. This study contributes to existing literature by empirically disentangling the dual stages of telecom fraud—offender selection and successful deception—and providing insight into the full-chain mechanism through which financial vulnerability operates. The findings support a dual-track prevention strategy, combining targeted financial education, behavioural interventions, and family-based risk mitigation to disrupt the fraud process and protect high-risk groups.</p>

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The offender’s selection paradox: why the financially vulnerable are targeted less but victimized more in China’s telecom fraud

  • 期刊论文

  • 发表日期：

    2026年1月8日

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  • Wentao Huang,
  • Hafizuddin-Syah B.A.M,
  • Mohd Hasimi Yaacob,
  • Chun Yao

摘要

Telecom fraud is an escalating global concern, yet its household-level financial determinants remain insufficiently understood. Drawing on nationally representative survey data from China, this study investigates how household financial vulnerability influences both exposure to and victimisation by telecom fraud. The findings reveal a paradoxical pattern: financially vulnerable households are less likely to be initially targeted, yet once exposed, are significantly more prone to victimisation. Mechanism analysis identifies two behavioural pathways: lower financial literacy among vulnerable households reduces early exposure, while elevated risk preference increases susceptibility after contact. The results remain robust across alternative specifications and subsamples, with an instrumental variable approach employed to mitigate potential reverse causality. Heterogeneity analyses further show that households headed by men are more likely to suffer financial losses, and that those whose household heads are middle-aged, educated, and married face greater targeting risks. Larger households are less frequently targeted but more likely to incur losses once exposed. This study contributes to existing literature by empirically disentangling the dual stages of telecom fraud—offender selection and successful deception—and providing insight into the full-chain mechanism through which financial vulnerability operates. The findings support a dual-track prevention strategy, combining targeted financial education, behavioural interventions, and family-based risk mitigation to disrupt the fraud process and protect high-risk groups.