Lanzhou probes investment scam involving films, TV shows
Published: Jan 23, 2024 12:23 AM
Moviegoers check in at a cinema in Dongguang, South China's Guangdong Province on December 14. Photo: VCG

Moviegoers check in at a cinema in Dongguang, South China's Guangdong Province on December 14. Photo: VCG

 A fraudulent investment scheme involving films and TV shows is being investigated jointly by the procuratorate and security bureau of Lanzhou in Northwest China's Gansu Province.

According to Shangyou News, a total of four media companies were part of the case, which involved 12 films, including I'm Livin' It starring Aaron Kwok and Miriam Yeung.

The Lanzhou police revealed that the criminal gang tricked investors into purchasing "profit shares" for the films. As early as 2020, some investors had initiated legal action against the companies involved.

On January 16, the Lanzhou authorities issued a notice stating that in 2022, the Lanzhou Municipal Public Security Bureau had cracked down on a fraudulent film and television scheme.

The criminal gang carefully packaged their activities on social media such as QQ and WeChat, claiming to have the roles of "lecturers" and "assistants of the companies," and then exaggerated the production costs and expected box office returns of the films to trick people into investing in them.

According to the notice, only a small portion of the fraudulently obtained funds were used to purchase shares from the film production company, while the remaining funds were used for other fraud operations and personal use.

A 42-year-old victim surnamed Li said that he joined the investment on March 24, 2020, saying the "lecturer" had conducted a livestreaming session offering stock market knowledge and recommending certain stocks.

After a while, Li was encouraged by the lecturer to invest in a film called I'm Livin' It.

"The lecturer told us that the previous returns were 2.8 times the investment, and said that if we made an investment in this new film, with a conservative estimate of a box office of 1.5 billion yuan, the returns could be 3 to 5 times the investment," Li recalled.

For many investors, it seemed like a good deal. The films had A-list celebrities, and the investment agreement appeared legitimate, saying that Party A (the company) promised a full repurchase of all the corresponding shares of Party B (the investor).

However, the investors did not receive the expected high returns, and in order to recover their principal money they filed lawsuits against the film and TV companies.

The case spans multiple regions, including Beijing, as well as Jiangsu, Zhejiang, Fujian, Hunan and Guangdong provinces.

Lawyer Liu Ying told the Global Times on Monday that for some films that have not yet been released, some courts have supported investors' civil claims. "However, for films that have already been released, investors' claims could have been rejected by many courts. Insufficient evidence is one of the main reasons why it is difficult for investors to protect their rights."