The latest bout of diplomatic sparring between the rivals kicked off last week, when Malaysia deported 20 Taiwanese implicated in fraud that Chinese authorities say took place on the mainland.
Beijing had insisted the group should be sent to China rather than returned to Taiwan, but following negotiations they were deported to Taipei.
The suspects, however, were freed soon after they arrived on the island, as police said Malaysian authorities had not provided enough evidence to arrest them.
Taiwanese authorities then appeared to make a U-turn, as a district court in the central city of Taichung issued arrest warrants for 18 of the suspects and barred the other two from leaving Taiwan.
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"After checking what the suspects told police and the evidence we got, we found they were deeply involved in the fraud cases," a prosecutor told reporters.
China considers Taiwan to be one of its provinces awaiting reunification, by force if necessary, even though the island has ruled itself since 1949 following a civil war split.
Taipei last week blasted Beijing for being "rude and violent" over the deportation of 45 of its citizens from Kenya to China where they also face investigation for fraud.
A group of 10 Taiwanese government officials, police and prosecutors are in Beijing negotiating the return of the 45 suspects.