80 billion P2P loaning exchange cracked down by police, used to issue coins
According to Sina, Tang Xiaoseng, a p2p loaning exchange with self-proclaimed state-owned enterprise background, was shut down unexpectedly during the dragon boat festival. The exchange boasted to yield 80 billion yuan in volume. Zibang Jinfu, the parent company of Tang Xiaoseng, has been shut down by police. Many investors claimed that withdrawal has been suspended and customer service failed to respond. Investors who paid site visit to the company are asked by police to provide more information.
Zibang Jinfu, the parent company of Tang Xiaoseng, has been shut down by police
Tang Xiaoseng was once honored as the top four p2p loaning platform in China. The other three companies are Qianbao, Yatang and Lianbi Finance. So far three of the four exchanges are reported to be shut down except Lianbi Finance. The specific amount of money involved in Tangxiaosheng’s case is currently unknown, but it involves a wider range of investors. According to the latest disclosure by the wechat account, the number of registered users has reached 10 million. According to the industry’s 1% conversion rate, it’s roughly estimated that there are 100,000 victims.
In fact, there were already signs before the exchange went down. According to an announcement released by the exchange’s app, the platform would be suspended from 22:30 on June 15 to 14:00 on June 19 for “system upgrade”, which was unusual during the holiday and took too much time and therefore looks suspicious.
According to data disclosed by Tang Xiaoseng, as of May 31, 2018, the platform had loaned 932 million yuan to 948 lenders, of which the top ten lenders had a total of 1.3467% of the amount to be repaid and the largest single lender accounts for 0.1833% of the total amount to be paid.
On 20 January, 2017, Zibang Jinfu, the parent company of Tang Xiaoseng, was acquired by the so-called state-owned company, Ruibao Liyuan. The company was registered in 1985 as a national company for international economic and technical cooperation but it was no longer a state-owned company after multiple change of shareholding.
Liu Bao, chairman of Ruibao Liyuan, started selling virtual currencies called “Asian and European currencies” throughout the country in 2017 and claimed to be the only virtual currency approved by the authority. On the “Asian-European coin” website, it was publicized as “the first government-issued virtual digital currency”. The project has no operational entities but relies on MLM deposits to keep it running. More than 47,000 members were signed up across the country, involving a total amount of 4.06 billion yuan.
More importantly, Tang Xiaoseng has not placed their money under any bank custody since its establishment in May 2015.