Woman arrested for offering fake rides on car-hailing app

Beijing prosecutors have ordered the arrest of a local woman who allegedly swindled car-hailing service Didi-Kuaidi out of some 30,000 yuan (4,727 U.S. dollars) with fake rides, local newspaper Beijing Times reported on Saturday.

The case, the first of its kind involving the so-called on-demand economy, highlighted the fierce competition and problems involved in the nascent ride-sharing business in China.

To expand their market share, car-hailing service providers such as Didi-Kuaidi and Uber have been spending heavily in China, doling out bonuses to drivers and passengers who use their services. The practice thus stimulated many drivers to take advantage of software loopholes by faking ride requests.

The woman, surnamed Chang, pretended to be both driver and passenger by using software. Then she paid for the faked ride with coupons issued by Didi-Kuaidi before cashing in. She managed to earn more than 30,000 yuan within several months, said Beijing Times.

Chang is accused of committing fraud, said the report, adding the case is still pending trial.

On Taobao, an online shopping platform backed by Alibaba, it only takes a simple search to find similar software used by Chang to fake rides. There are others selling fake Uber accounts.

The report said companies like Didi-Kuaidi, now already at a valuation of more than 15 billion U.S. dollars, lack the means to tackle such fraudulent practices. Endi