Fake coins can now be found in several Chinese cities.

Many convenience stores, snack bars, and newspaper stands are buying them and giving them as change to customers, who then spend them in other places, according to Nanfang Weekend.

Two employees of a fake coin retailer in Guangzhou, capital of southern Guangdong Province, who gave their names as B Zai and A Wei, told the paper that many local convenient stores and snack bars buy from them.

Their boss buys fake coins, valued at 1 yuan each, from a wholesaler and sells them to shops at 35 fen.

A Wei, who is in charge of sales, said there are many competitors in the business and disputes over territory regularly occur.

Retailers stick posters on walls and lampposts, and also advertise on the Internet.

A Wei said his boss purchased from a man named Shun Ge, who is considered a major operator.

Shun was based in Guangzhou and moved to Wuhan, capital of Hubei Province, at the end of last year because of a crackdown on fake money businesses.

In the crackdown, the Ministry of Public Security listed eight cities including Guangzhou and Wuhan as major targets.

Shun told the paper that his products were all made by the best manufacturer in central Hunan Province and were sold to cities in Guangdong and Hunan provinces.

"Most coin identification machines cannot detect them from genuine ones," he said.

Shun said he had connections in government and the underground world.

Most of the wholesalers purchase from Hunan Province. In September last year, the Ministry of Public Security held a meeting with policemen from four provinces before conducting a raid.

Several factories in Changsha, Hunan Province, were raided.

In one factory, 8 tons of coins were seized. The factory was located under a pigsty.

Li Ziyong, an officer with the Ministry of Public Security, said fake coins had become a new trend in the counterfeit money business.

"Coins are simple to copy as they do not have anti-counterfeit safeguards," he said.

Qian Qi, a financial expert, said most people cannot tell a genuine coin from a fake one, and most do not look carefully at the coins because of their low value.

In the first eight months of last year, Hubei Province confiscated more than 10.52 million counterfeit coins with 1 yuan face value.

(China Daily 07/06/2007 page5)