Business
18:09, 12-Sep-2017
Two Chinese executives get life in prison for $7.7 bln Ponzi scheme
["china"]
Share
Copied
Twenty-six executives of a Chinese online peer-to-peer (P2P) lender were sentenced to jail from three years to life imprisonment for cheating the public out of large amounts of money Tuesday by the Beijing No. 1 Intermediate People's Court.
According to the court, Anhui Yucheng and Yucheng Global, operators of online P2P lender Ezubao, and 10 company executives, including Yucheng chairman Ding Ning, were found guilty of fundraising fraud. Another 16 relatives were convicted of illegally absorbing public deposits.
Yucheng Global and Anhui Yucheng were ordered to pay fines of 1.8 billion yuan (278 million US dollars) and 100 million yuan, respectively, the court said.
Ezubao's Chairman Ding Ning /CCTV 13's screen shoot
Ezubao's Chairman Ding Ning /CCTV 13's screen shoot
Chairman Ding Ning and his younger brother Ding Dian were both sentenced to life in prison and were fined 100 million yuan and 70 million yuan, respectively.
The remaining 24 were given three to 15 years in prison and were also deprived of political rights and issued fines. The court also pointed out that some of the defendants were convicted to other crimes, including smuggling precious metals, illegal possession of guns and border-crossing.
With no technical or financial training, Ding launched Ezubao in July 2014 and opened multiple marketing offices across China. Ezubao represented just a sliver of China’s shadow banking industry estimated to be worth 1.5 trillion US dollars as of the end of June, according to Chinese banking regulators.
VCG Photo
VCG Photo
Under the court's investigation, Anhui Yucheng and Yucheng Global had raised a huge amount of funds by faking high-yield investment products on two online P2P platforms, Ezubao and Sesame Financial, without a banking license between June 2014 and December 2015.
A majority of the money was spent lavishly on luxury gifts and salaries and used to purchase sales firms and return principal and high interests to some investors.
Police shut down Ezubao last year after raising more than 50 billion yuan (7.7 billion US dollars) from about 900,000 investors.
27km