The answer should be obvious. There are unintential false-positives and unintentianal false-negatives. But, the real issues with this form of matching are intentional false-positives and what happens to the data.

Well, that would be the issue in the many parts of the world, but the reporting refers to China. In case you are not aware China is run by a dictatorial authoritarian regime that has expansive powers and has does not treat people humanely.