Life in prison for fraudster who raised over 3.6b yuan

A man was sentenced to life in prison for fundraising fraud and illegal collection of deposits from the public, involving a total of over 3.6 billion yuan (US$500 million), Shanghai First Intermediate People's Court said on Wednesday.

The court said Feng Xiang was the controller of a Shanghai-based industrial company called Zhongyan and other related firms.

Between 2017 and 2021, the companies released financial products without the approval of national regulatory authorities, illegally raising over 3.3 billion yuan. To attract investment, they promised annual interest rates of between 5 and 30 percent, causing investors to suffer losses of over 900 million yuan.

Also, at the end of 2020, Feng established a company with other people to auction calligraphy and painting.

To create the impression that the company was thriving with frequent transactions and that investors' capital and interest were safe, Feng asked a team at Zhongyan to woo people to be members of the auction platform and get them involved in false transactions.

They promised that if the members bought artwork on the platform, the product could be returned and their money would be returned with one percent of the price as a reward. The investment and turnover on the platform total reached over 331 million yuan from January to June 2021.

Feng was deprived of his political rights for life, and all his personal property was confiscated. He was also fined two million yuan, the court said.