China seizes $1.5b worth assets in latest P2P lending crackdown

Photo: Reuters

China has arrested 62 suspects abroad and seized 10 billion yuan ($1.5 billion) in assets from 380 fraudulent peer-to-peer (P2P) lending platforms since June as part of a crackdown on online finance, the public security ministry said.

The arrest of P2P suspects hiding overseas is a top priority of Operation Fox Hunt, part of President Xi Jinping’s war on corruption that includes bringing back government officials and business executives who have fled abroad with assets.

The ministry said their teams “successfully brought back 62 criminal suspects from 16 countries and regions, including Thailand and Cambodia.”

The suspects are accused of crimes related to illegal fundraising, the ministry said on its website.

P2P platforms gather funds from retail investors and loan the money to small corporate and individual borrowers, promising high returns. At its peak in 2015, the sector had about 3,500 businesses in China.

The P2P industry had outstanding loans of 1.49 trillion yuan ($217.96 billion) last year, far larger than the combined sector outside China.

After Beijing moved to defuse debt bubbles and reduce risks in the economy, including the shadow lending sector, a wave of company collapses hit the P2P sector and triggered protests by angry investors who had lost their life savings.

The latest investigations found that many fraudulent P2P operators had lured investors with the promise of high returns, but had falsified investments and embezzled funds, the ministry said.

Also read:

SoftBank-backed Yidai is latest to exit business amid China’s crackdown on P2P lenders

China: Ping An-backed P2P lender Lufax raises $1.3b at lower valuation

Reuters

 

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.