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Xu Qin appears on Chinese state-run television. File photo

Chinese high-flyer’s Ponzi scheme funded lavish lifestyle

The alleged mastermind behind the latest Ponzi scheme to rock the mainland’s financial sector was found to have misused investors’ money to support his lavish lifestyle, mainland media reported yesterday.

Xu Qin, 35, a Shanghai native who founded and controls Zhongjin Capital Management, confessed on state television over the weekend that he had operated a Ponzi scheme defrauding thousands of investors. He has not been formally charged.

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Xu was apprehended by local police at a Shanghai airport early last month trying to leave the country.

Online news portal Thepaper.cn reported that Xu’s companies, which he described as private equity businesses, netted a combined 39.9 billion yuan (HK$47.4 billion) from wealthy mainlanders. He spent about 150 million yuan a month on his lifestyle, included payments to celebrities to promote the company.

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He raised a peacock in his flat at Tomson Riviera, one of the city’s most expensive residential complexes, the news portal said. The Beijing News reported that Xu and his wife spent 500,000 yuan a month on living expenses, of which 200,000 yuan was rent. He had also spent more than 140 million buying luxury cars. After graduating from high school, Xu served in the army before returning to Shanghai to work in an office in a local hospital.

Xu founded Zhongjin in 2011 and rented office space at prime locations, including the Bund area, to convince backers of the group’s financial strength. Thousands of investors, enticed by double-digit returns, flocked to Zhongjin to buy its wealth management products.

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