CCTV Investigation: HR firms openly sell fake social insurance services to defraud benefits

Overview

China has maintained strict oversight of social security fund management this year, cracking down on various types of fraud and illegal benefit claims. However, recent reports to CCTV's Financial Survey program reveal that certain human resources companies are openly defying regulations by selling "agency social security contribution" services online, using fabricated employment relationships to fraudulently obtain social security benefits.

Fake Payrolls and Contracts: How "Agency Enrollment" Schemes Steal Social Security Funds

When reporters searched for keywords such as "agency social security contributions" on social media platforms, numerous posts openly advertised services claiming "no need to work, just enroll." In the comment sections, a user named "Lin Qi" offered to help others enroll and pay social security contributions on their behalf.

Through "Lin Qi," reporters contacted and visited a branch of Space Unlimited Human Resources Group in East China. Staff explicitly stated that enrollment does not require actual work attendance but does require cooperation in fabricating fake payroll records and signing fake labor contracts to evade regulatory scrutiny.

The method for creating fake payroll records works as follows: the enrollee first transfers funds to the company, and on payday, the company transfers the money back to the enrollee's personal account, thereby fabricating a wage payment record. Simultaneously, a fake labor contract is signed for inspection purposes only.

Legal Consequences

Article 88 of the Social Insurance Law of the People's Republic of China clearly stipulates:

Anyone who obtains social insurance benefits through fraud, forged证明材料, or other deceptive means shall be ordered by the social insurance administrative department to return the fraudulently obtained social insurance funds and shall be fined between two and five times the amount fraudulently obtained. If the act constitutes a crime, criminal liability shall be pursued according to law.

Cost Breakdown

Reporters asked staff to calculate the costs. Using the local 2026 social security contribution base floor of 4,354 yuan per month, the company used a declared base of 5,000 yuan for convenience:

| Category | Item | Amount (yuan) | |----------|------|---------------| | Employer portion | Pension | 800 | | | Medical | 320 | | | Unemployment | 25 | | | Work injury | 10 | | | Subtotal | 1,155 | | Employee portion | Pension | 400 | | | Medical | 100 | | | Unemployment | 25 | | | Subtotal | 525 | | Additional costs | Disability insurance (normally employer-paid) | 75 | | | Service fee | 120 | | Total borne by enrollee | | 1,875 |

Profiting from Fraud

Staff further revealed that for an additional fee, the company would help enrollees extract money from the social security fund:

• Unemployment insurance: 1,000 yuan service fee
• Maternity insurance: 1,000 yuan service fee
• Work injury insurance: 2,000 yuan service fee

According to local standards:

• Unemployment benefits: 2,088 yuan per month, up to 24 months, totaling over 50,000 yuan
• Maternity allowance (based on 5,000 yuan base, 158-day maternity leave): over 26,000 yuan

Once successfully claimed through fabricated employment relationships, these funds flow out of the national social security pool. Staff claimed that for just 1,000 yuan in service fees, they could easily extract money from the social security system — meaning each transaction effectively transfers 1,000 yuan from the national pool into the company's pocket. Staff also stated that the company had been conducting such business since its establishment.

Price List for Fraud: 1,000 Yuan to Illegally Claim Unemployment Benefits

Following tips from the public, reporters contacted Junhehui Human Resources Technology Co., Ltd. On-site, the company's operating model was nearly identical to the previous one. Staff stated that for a 1,000 yuan fee, the company could help enrollees fraudulently claim unemployment benefits.

Staff also indicated they could assist in obtaining maternity allowances, with a minimum payout of 25,000 yuan, and some clients had already received over 50,000 yuan. To successfully claim such benefits, enrollees typically needed to start making social security contributions from the first month of pregnancy and maintain continuous contributions for 10 months before the end of maternity leave. Staff showed reporters chat records with clients to confirm successful claims.

Exploiting Graduate Subsidies

Hangzhou Shandao Construction Technology Co., Ltd., in online communications, not only promised to help fraudulently claim unemployment benefits, work injury insurance, and maternity allowances through fake employment relationships but also offered to assist in applying for Hangzhou's fresh graduate living subsidy.

This subsidy is a policy designed to attract talent to Hangzhou:

• Bachelor's degree: 10,000 yuan
• Master's degree: 30,000 yuan
• Doctoral degree: 100,000 yuan

The subsidy is paid in two installments: half after six months of continuous social security contributions, and the remainder after 12 months. Applicants must be genuinely employed by a Hangzhou-based company with continuous contributions.

The company fabricated payroll records to help clients fraudulently claim the subsidy. Clients transferred money to the company's finance department, which then transferred it back from the corporate account to the personal account — "as if the company paid you wages." Staff claimed that if investigated, this would serve as "ironclad evidence" of an employment relationship.

Expert Warning: No Shortcuts in Social Security

Professor Xie Shu from the Criminal Justice School of China University of Political Science and Law stated:

For individuals without fixed employment, the state has already established relatively comprehensive personal enrollment and safety net policies. There is no need to take risks. For example, for pensions, individuals can participate in employee pension insurance or urban-rural resident pension insurance as individuals. For medical care, they can join employee medical insurance or urban-rural resident medical insurance. In some regions, maternity medical benefits have also been incorporated into medical insurance. Basic protections are covered by existing systems.

Without genuine employment, relying on forged labor contracts and payroll records to enroll directly undermines the fundamental logic of the social security system.

Intermediaries are the primary organizers and beneficiaries of this fraudulent enrollment industry. They exploit public anxiety about policies and information asymmetry to sell fake enrollment services, profiting from both sides — charging high service fees from ordinary people while assisting in siphoning national social security funds. This violates multiple administrative regulations and may constitute complicity in fraud, with most being treated as principal offenders.

There are no shortcuts in social security. Do not trust claims about "internal channels," "agency retroactive payments," or "enrollment to receive benefits."

Companies Paying for Fake Employees: Boosting Bidding Qualifications

Reporters also discovered a special type of fraudulent enrollment where enrollees only pay the employee portion of contributions, while the employer portion is covered by construction companies. For just a few hundred yuan per month, enrollees can enjoy social security benefits such as pensions without actually working.

Through a short-video platform account called "Huaibei Help Insurance," reporters contacted Jingkun Network Technology Co., Ltd. in East China. Staff explained that the company enrolls individuals as part-time employees, contributing at least 12,000 yuan annually to their pension accounts. Enrollees only need to pay 4,980 yuan per year (415 yuan per month) and never need to work to maintain a legitimate corporate social security contribution record.

How It Works

Staff explained that construction companies need to provide qualifications and technician certificates for project bidding to prove they are not shell companies. However, these companies are unwilling to bear the wages and labor costs of formal employees. They entrust intermediaries to recruit people in bulk, obtain technician certificates for them, and register them as part-time employees to meet qualification requirements — without any actual work or wage payments.

According to staff, the intermediary earns about 50 yuan in profit per enrolled person per month. With 1,000 to 2,000 enrollees, this accumulates into a substantial income over time. Moreover, these "employees" are only used during the short-term phases of qualification and bidding, after which they are transferred to other cooperating construction companies. This model of short-term, cross-company "floating enrollment" severely disrupts the bidding market order.

Safety Risks

Staff claimed that simply completing facial recognition — without any study, testing, or practical assessment — was sufficient to obtain various construction trade technician certificates. Most of these certificate holders, used for qualification declarations and bidding materials, have no practical experience and lack on-site construction capabilities.

To gain reporters' trust, staff randomly showed a video recording of an enrollee's "onboarding" process. Through these irregular operations, intermediaries have established a gray chain covering construction companies across multiple regions, with large numbers of unqualified individuals being packaged as on-site technicians to pass qualification reviews — creating hidden safety risks for various construction projects.

Early Retirement Loophole

Similar operations are not isolated. Under the short-video account "Human Resources and Social Security," numerous posts also promote enrollment through construction companies. Reporters visited Tai'an Jianxin Shuntong Engineering Consulting Co., Ltd. in Shandong, which also conducts large-scale similar business. Staff showed a registration form with nearly 1,000 enrollees.

Reporters noted that painters accounted for the highest proportion. Staff explained that painting is classified as a special trade, allowing early retirement at age 55 for men and 45 for women — a policy incentive used by intermediaries to attract enrollees. Staff also claimed they had never been investigated by regulatory authorities and that many enrollees had successfully retired through this method.

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