Eight charged in China over ‘Ponzi scheme posing as P2P lender’ that took US$9 billion
Shanghai police say Shanlin Finance’s activities echoed those in the Ezubao and other cases, and call on victims to come forward
Chinese authorities say they have exposed a Ponzi scheme that lured 60 billion yuan from retail investors, in what would be the latest success for the country’s risk prevention campaign.
Eight ringleaders of the Shanghai-based Shanlin Finance have been charged with illegally obtaining deposits and taken into custody, according to local public prosecutor the Shanghai Pudong district People’s Procuratorate, the official Xinhua News Agency reported on Tuesday.
The scheme was disguised as a peer-to-peer lending platform, police said. Shanlin’s online lending platforms and mobile apps have been suspended from service.
Shanghai police called on victims to come forward with information, with the amount of money embezzled and the number of victims still unclear.
Shanlin stated in a social media post on February 11 that one of its online platforms, Shanlin Wealth, had registered more than 500,000 users and raised 5.4 billion yuan.
But its mastermind Zhou Boyuan turned himself in to local police two weeks ago as the amounts due to be repaid snowballed and new investment dried up, partly as a result of the intensified government crackdown on such activities.
Internet finance, including China’s thousands of online P2P and crowdfunding platforms, and internet-related frauds are key targets of Beijing’s derisking campaign, launched last year and expected to continue for the next three years.