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FRAUD

Hainan businessman suspected of 1b yuan fraud 'disappears': police

PUBLISHED : Thursday, 19 December, 2013, 12:14pm
UPDATED : Thursday, 19 December, 2013, 12:14pm
 

A leading businessman in Hainan province suspected of a 1 billion yuan (HK$1.27 billion) fraud has disappeared, police said.

Shen Guilin, vice chairman of Hainan Federation of Industry and Commerce, went missing after allegedly defrauding more than 150 investors, including some government officials, a total of 1 billion yuan, the Beijing Times reported. The newspaper said Hainan police confirmed they were investigating the case.

Shen, owner of an auction house and pawnbroker, reportedly offered high interest rates to investors who loaned money to his companies in sums ranging from a couple of thousand yuan to a couple of million yuan, the newspaper said.

Investors and employees lost contact with Shen after December 7 and called the police. His personal and company accounts were frozen by the police but found to contain little money, a sign that he had long planned his escape, according to the investors.

The newspaper said the victims gathered at the office of Shen’s Taite Pawnbroker company in Haikou, and formed a temporary committee to register their losses. Some claimed Shen had fled to the US.

Shen, who arrived in the island province in 1992 after quitting his job, started off as a pawnbroker in 1996 and founded Taite in 2000 before venturing into the auction and cultural industry as well, the newspaper said. He had built up a good reputation within Hainan’s cultural business circle, having served as the chairman of the province’s Association of Auctioneers, Association of Collectors, and Association of Pawnbrokers.

The Hainan Federation of Industry and Commerce, of which Shen is vice chairman according to reports, did not have any information about Shen on its website on Thursday.

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