Apr 27, 2019 05:09 PM

Police Arrest 41 Associated With Failed P2P Lender

Photo: IC Photo
Photo: IC Photo

Authorities have arrested 41 people associated with, one of China’s major peer-to-peer (P2P) lenders, after the platform collapsed in March and left tens of thousands of investors scrambling to get back their life savings. co-owners Tang Jun, Zhang Lin and two other people were charged with fraudulent illegal fundraising and illegally collecting people’s deposits. The other 37 suspects were charged with illegally collecting public deposits, according to prosecutors in the city of Dongguan in southern China’s Guangdong province.

The P2P lending website was put under investigation for illegal fundraising by Dongguan police on March 28. That same day, Guangdong Paisheng Smart Technology Co. Ltd, a Shenzhen-listed company controlled by Tang, asked that trading in its stock be suspended because of fears of sharp fluctuations in its price because it had failed to reveal “key issues.”

Co-founded in 2012 by Tang and Zhang, was one of the earliest participants in the country’s frenzy to take advantage of the online lending boom. Hundreds of P2P platforms have collapsed in the past two years after authorities tightened controls on this sector to reduce financial risks.

As of February 28, the platform had matched 220,000 lenders with 370,000 borrowers, with a total loan balance amounting to 14.5 billion yuan ($2.2 billion).

Many of the investors have reported to authorities hoping to get back their losses. Dongguan police said they have received more than 150,000 cases of people reporting losses from investing on

By April 2, authorities have frozen 3.1 billion yuan in’s bank accounts, confiscated 35 housing properties, one aircraft and 40 automobiles.

After discovering Tang and Zhang had tried to transfer and hide some of their assets before the start of the investigation, police started to freeze their bank accounts. As of April 19, police had uncovered more than 880 million yuan that Tang and Zhang tried to hide.

After trading resumed in April, Paisheng Technology’s stock price continued to fall. It dropped to 20 yuan per share on April 26, less than half its price of 52 yuan on March 27.

Contact reporter Wu Gang (

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