Fake Bank in Nanjing Decorated As State-Owned Bank, Illegally Collected 200 Million Yuan [RMB] in Deposits


Posted by Low Hwan Hong, Year 4 undergrad at the School of Business, Singapore Management University

According to a Xinhua report, a “cooperative” that had absolutely no financial qualifications meticulously decorated their interior to resemble that of a state-owned bank and used high interest rates to entice city residents to come deposit their money, scamming nearly 200 people in just over a year, involving nearly 200 million yuan [RMB].2014 May, Wang X, from Zhejiang province Hangzhou city, was introduced by a “middle-man/intermediary” to the “Nanjing X Rural Economic Special Cooperative” located on Jiangpu Street in Pukou district of Nanjing, where he deposited 12 million yuan in his company’s liquid funds. This “cooperative” promised to give Wang X the same interest for the same period a bank would give but also an additional 2% interest every week.

However, after receiving 4 consecutive weeks of additional interest, this “cooperative” stopped giving Wang X additional interest. Wang X hurried from Zhejiang to Nanjing over this only for the other party to not only give him the additional interest but to discover that he could not withdraw his 12 million yuan either. 2014 June, Wang X reported the matter to the Nanjing Pukou district police.

After the Nanjing Pukou police launched an investigation, they discovered that the business license for this “Rural Economic Special Cooperative” limited its operations to rural/agricultural information and consulting which has no relation whatsoever to financial services and products, and thus prosecuted this “cooperative” on suspicion of illegally collecting public deposits.

Pukou police explain that this “cooperative” began offering high rates of additional interest in addition to the interest rates given by banks in 2014.

Pukou police also explained that when this “special cooperative” engaged in interior decorations, it had completely imitated the look of a state-owned bank, not only designing counters like that of a bank but also with LED display screens, a customer queuing system, etc. to the extent where the five counters had “workers” dressed in uniforms resembling that of a bank. After some depositors were lured in and saw this, they thought it was a regular credit association/union.

At present, Liu X, the legal representative of this “cooperative” suspected of illegally collecting public deposits, and three other “business managers” have already been detained as criminals. One female high senior manager who fled with with the illegally acquired funds also having been convinced by Nanjing police to return and surrender herself on 2014 December 31, while another two assistants hired by Liu X remain at large.


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