Investors in fraudulent Ezubao asked to register information to receive compensation

Source:Global Times Published: 2019/6/26 14:43:40

Investors embroiled in the fraudulent peer-to-peer (P2P) financing platform Ezubao are urged to register details of their losses for possible compensation, read an announcement made by the No.1 Intermediate People's Court in Beijing on Wednesday.

According to the announcement, investors of Ezubao can register the details of their investment loss, along with their personal and banking information with the designated local authorities from July 2 to August 30. Compensation for individual investors will be calculated based on the registered and verified information. 

However, according to a report on the website of the Taizhou police in East China's Zhejiang Province, only 20 percent to 25 percent of total investment loss could be compensated to individual investors, as government fines, creditors of Ezubao bank loans and bonds will get prior compensation, according to Chinese law. 

Ezubao first came under investigation in December 2015 for illegal operations that wrung out over 76.2 billion yuan ($11 billion) from its investors, according to a report by Since its launch in 2014, the infamous financing platform, which turned out to be a Ponzi scheme, has fleeced over 900,000 investors, and has a total amount of 38 billion yuan in unpaid loans, the report says. 

Since the start of the investigation in 2015, several suspects from the company's management have been detained by the police.

Like many other financial scams, Ezubao first attracted its duped investors with unrealistically high returns and assurances of minimal risk. Right after its launch, it promised a hefty 9 to 14.6 percent annual return, far higher than regular financial products in commercial banks.

According to a report by the Xinhua News Agency in 2016, the Ezubao platform was a typical example of a Ponzi scheme, as 95 percent of the company's financial products were fraudulent, and the money acquired was used to set up new "products". 


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