China Auto Subsidy Scheme Unravels, Leaving Consumers and Banks Exposed

A massive auto trading scheme in China has unraveled, leaving consumers and financial institutions facing significant losses after two dealerships allegedly exploited the country’s vehicle trade-in subsidy program.

The sophisticated operation, which took advantage of government incentives designed to spur auto sales, highlights vulnerabilities in lending oversight and could trap over a thousand victims with loan defaults and repossession risks.