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China-announces-234-arrests-in-provincial-banking-scam-promising-high-rates
China-announces-234-arrests-in-provincial-banking-scam-promising-high-rates

234 arrests were made in China, with provincial banking scams promising high rates

China-announces-234-arrests-in-provincial-banking-scam-promising-high-rates

On Monday, authorities in central China reported the detention of 234 suspects in a scheme to defraud people of their savings by making false promises of high-interest rates on deposits in unrecognized rural banks.

Investors were looking for answers about where their money went and were barred from traveling to Zhengzhou, the capital of the Henan province, when the health status shown on their required COVID-19 cellphone apps abruptly turned red, barring them from doing so.

The AP spoke with many bank customers who claimed police had interrogated and threatened them.

In response to a subsequent attempt in July, groups of unknown persons wearing white shirts attacked depositors while police stood by.

The alleged mastermind, Lu Yiwei, and his collaborators, according to a statement from the Xuchang city government, had taken control of four county-level banks and had enticed investors with promises of interest rates as high as 18% yearly.

“Currently, many criminal suspects have been captured by public security agencies, 234 of whom have been arrested,” as per the statement.

“Recovery of stolen goods and damages has advanced significantly. According to the legislation, a thorough investigation and case processing are being done.”

According to the statement, the plan’s creators, who eventually “took” the funds, promoted the investments to other people who made large deposits, giving the fraud the impression of a Ponzi scheme.

There was no mention of any alleged coordination between suspects, police, and local authorities.

Thousands of clients established accounts at six banks in Henan and the nearby province of Anhui, which provided comparatively high-interest rates as the fraud developed. Many Chinese have invested in unusual, frequently dangerous, or fraudulent financial instruments due to the dramatic decrease in China’s economic development and the paltry returns on savings in official banks.

After hearing in the news that the CEO of the bank’s parent firm was wanted for financial offenses, the clients of the Henan banks later discovered they were unable to withdraw money. In addition, a group with connections to banks is being investigated by police.

Although bank officials have stated they will return some bank clients’ savings, many are still awaiting word on when they will be compensated.

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