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817 people arrested due to illegal fundraising in Beijing in 2017

July 4th Beijing– Beijing authority is warning illegal fundraising with the name of blockchain. “The situation of financial crimes in the name of Internet finance has become increasingly serious.” Jiang Shuzhen, director of the Department of Economic Crimes of the Beijing Procuratorate, told reporter that self-financing platforms were established under the name of P2P loaning. The cases of fake equity trading projects have increased year by year with the increase of victims. In addition, illegal fundraising in the name of virtual currency and blockchain is also emerging.

The Beijing Procuratorate held a press conference on July 4 and issued the “Financial Prosecution White Paper” to inform the public of its financial prosecution work in 2017. Jiang Shuzhen said that the number of illegal fund-raising cases has continued to increase with more major cases. In such major cases, the company involved created a certain number of companies in a short period of time, affecting multiple regions. Related companies covered each other and become more deceptive to investors. The numbers of scammers and victims are huge.

According to statistics, in 2017, Beijing procuratorial closed a total of 889 cases of financial crimes review and arrested 1,342 people, with 1,820 cases submission. Compared with 2016, the number of cases accepted in 2017 increased by 4.33%, and the number of people involved increased by 20.03%.

In terms of illegal fund-raising cases, a total of 428 cases were accepted and 817 people arrested in2017. 302 cases were examined and 817 people prosecuted, an increase of 26.63% and 40.47% respectively compared with 2016.

Jiang Shuzhen pointed out that there were problems with financial crimes such as difficulty in investigation and evidence collection, disputes in applicable laws, difficulty to obtain evidence across regions, crimes definition, personal crimes and entity crimes.

In addition, financial regulations are relatively lagging behind the development of new financial models such as Internet finance. For example, the recent emergence of fraudulent case like “Huaqiang Coin”, “Wuxing Coin” and other virtual currency-based criminal activities. The “ICO Ban” issued on September 4, 2017 reminds the public of hazards related to token financing and trading and has a good effect. But the meaning of token, issuance of securities, illegal fund-raising, financial fraud, pyramid schemes, remains to be obscure. In order to deal with the emerging scenarios, relevant laws and regulations should be improved as soon as possible to promote the effective connection between administrative law enforcement and criminal justice.


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