"We Need To Rise Up": Bilked Chinese Investors Call For Nationwide Uprising After Massive Ponzi Uncovered

Tyler Durden's picture

Well, don’t say we didn’t warn you.

Just yesterday, in the course of documenting the largest ponzi scheme the world has ever known (in terms of number of victims), we remarked that if China’s beleaguered masses needed yet another excuse to rise up and stage massive street protests, they got one in the form of online P2P lender Ezubao, which defrauded nearly a million people.

Ezubao’s model wasn’t exactly complicated. Investors, they said, could earn between 9% and 15% by funding a variety of projects presented on the company’s website. When the money came in, management simply absconded with it all and attempted to repay old investors with new investors’ money.

34-year-old Ding Ning - the company’s founder - had a penchant for spending investors’ hard earned money on things like CNY12 million pink diamond rings. "Among gifts that Yucheng Chairman Ding Ning gave his president, Zhang Min, were a $20 million Singapore villa, a $1.8 million pink diamond ring, luxury limousines and watches and more than $83 million in cash," Reuters recounts, before adding that "Zhang, the group president who was marketed as 'the most beautiful executive in online finance', said on state broadcaster CCTV that Ding asked her to buy up everything from every Louis Vuitton and Hermès store in China, "and go overseas to buy more if that wasn't enough."

(Ding Ning at an "undisclosed location")

According to a highly amusing Google translation of a Xinhua story, Ding Ning and “several closely related groups of female executives, their private life extremely extravagant, spendthrift to suck money.”

Yes, “spendthrift to suck money” and if there was anything Ezubao was particularly adept at, it was “sucking money” - from 900,000 unsuspecting Chinese who staged protests in December following the government’s move to freeze the company’s assets.

“Expect more protests to come,” we warned.

Well sure enough, disgruntled investors are now uniting in a nationwide “rights protection” movement. Their first order of business: to call for three days of protests.

“If we don’t protect our rights, make appeals and take other drastic action within three days, we will recover little,” said a bulletin making the rounds among Ezubao investors. “We need to rise up across the country and let the government know that the people’s bottom line is the return of their capital. If it is not returned our movement will not stop!

Many investors were lured in by the company’s flashy advertising campaigns and gimmicks. “Ezubao expanded rapidly across the country by advertising extensively on Chinese Central Television.” FT writes. “It sponsored a forum about the country’s parliament on Xinhua’s website and sponsored popular events such as the China Open tennis tournament and emblazoned high-speed rail cars with its logo.”

"When you got on the train, there was an announcement saying: "'Welcome aboard Train Ezubao'," a company employee who lost about CNY100,000 yuan in the scheme told Reuters.

Investors who put up at least CNY150,000 were given five-gram commemorative gold bars. "I feel terrible," an Ezubao investor surnamed Liu who said she lost CNY800,000 lamented. "I haven't dared tell my husband yet."

“I gave Ezubao Rmb250,000 because of their association with government activities and news outlets,” one investor told FT. “Of course we invested because of the advertising on CCTV and the high-speed trains,” another said.

“Of course” they invested. They saw an ad on a train.

This mirrors the sentiments expressed by the millions of retail investors who watched helplessly last summer as their life savings were vaporized by the harrowing decline on the SHCOMP.

It also reminds us of what happened to Fanya Metals chief Shan Jiuliang who was kidnapped by a mob of angry investors and dropped off at the police station back in August. Although Fanya was probably less of a fraud than Ezubao, the underlying story is the same: unsophisticated Chinese investors were bamboozled and once they realized they had been had, they were out for blood. 

It's not likely that Ding Ning will see the light of day anytime soon, but if he were to go free, he might quickly wish he was back in prison given the fate Shan Jiuliang suffered early one morning last summer...

So stay tuned, because judging from the tone of the "rights protection movement" bulletin excerpted above, the villagers may be about to rise up in China.

Oh, and as for whether there may be other Ding Nings and Ezubaos lurking around in China just waiting to buckle under the weight of their own extraordinary ponzi-ness, consider this from Reuters: 

"By November, there were over 3,600 P2P platforms as the industry raised more than 400 billion yuan, according to the China Banking Regulatory Commission (CBRC). More than 1,000 of those were problematic."

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Bunga Bunga's picture

Losing in style ....

38BWD22's picture



"Little Trouble in Big China"

Big corruption is big trouble wherever found.

Unfortunately, corruption is getting BIGGER in Peru as well.  All of the viable candidates for president are filthy corrupt, they are ex-presidents too.  

And our sales are down over 50% vs. Jan 2015.

Ugh.  :(

highandwired's picture

Corruption runs rampant in all parts of the world, it's just a matter of degrees...


Take the US for instance...FBI murders a civilian in cold blood, wounds another, and attempts to murder 2 women and 2 men and what do the sheep say?  "Well good, he deserved it"!  


I suppose Victoria Sharp, the 18 year old woman, who had nothing to do with the occupation...she probably "deserved" to be shot at too.  I just have no more faith for humanity.  It is simply doomed.


Lavoy Finicum was murdered in cold blood by the FBI!  https://www.youtube.com/watch?v=Ydh49JV02f4



knukles's picture

Deez Nutz gotta understand the way Communism and Capitalism blend.
You all share in the losses.  Poverty redistribution.
Just what you always wanted.   Now go open that account with Goldman.  They'll take care of y'all real good.

CapnJackDaniel's picture

that's one viewpoint. Back in '89 about 100,000 students marched for Democracy. They got capitalism instead. Now we're 25 years on, and a million people are pissed. They don't want democracy. They just want their money back.  I'm not sure what all of this means. Or what China will do. This is not an idea you can chase back underground. Fuckers want to be made whole, not free. What's going on? Need Marvin Gaye now more than ever.

Four chan's picture

someone tell them there is no such thing as slaves rights.

manofthenorth's picture

They should have bought gold and silver instead.


NidStyles's picture

He should have bought his way into the Tribe, he'd still be a free man then.

NoPension's picture

He needs Jon Corzine's legal team. BTW, how about a story on what that prick has been up to lately.

HardAssets's picture

People think the various 'isms' are different - - - they're not.

Its all criminal gangsterism in the end.

Maybe this guy is in jail, but like Corzine, the real big time thieves and murderers run free.

TruthHunter's picture

Between 1993 and 2011 internal investigations  exonerated their own agents

in 150 out of 150 shootings. http://www.nytimes.com/2013/06/19/us/in-150-shootings-the-fbi-deemed-age...

What are the odds of that?


Do they expect us to believe they hire Angels out of Heaven?

Or that they should be trusted to investigate themselves?

OTH, who would dare investigate them?

El Oregonian's picture

P2P = Pee-on-Peons.

A crushing lesson on crony capitalism.

Max Cynical's picture

400B Chinese Yuan equals $60,801,364,000 US Dollar

Anti-kleptocrat's picture

It seems that protests are on the rise in many parts of the world, even here. And it's a short hop from protest to revolt with Ghadafi styled endings ... 

Father Thyme's picture

Rise up! Gather round, Rock this place to the ground, Burn it up let's go for broke, Watch the night go up in smoke

Pooper Popper's picture

"Sum Ting Wong."???

Just remember what ol' Jack Burton does when the earth quakes, and the poison arrows fall from the sky, and the pillars of Heaven shake. Yeah, Jack Burton just looks that big ol' storm right square in the eye and he says, "Give me your best shot, pal. I can take it."

Like I told my last wife, I says, "Honey, I never drive faster than I can see. Besides that, it's all in the reflexes."


TradingIsLifeBrah's picture

I can't believe their promised 14% annual return wasn't risk free.  If an investment is promising you a 14% interest rate and doesn't promise a loss of at least 50% of your capital alongside that, I wouldn't trust it but that's just me

Father Thyme's picture

I got 14% on a CD I bought back in the 1980s.

Later I cashed it in and bought a .... well, I'm too ashamed to say what kind of car that was. Sweet Jesus, that was a piece of shit.

If I'd have only got that CD for the maximum amount of years!


NidStyles's picture

Must have been a Jaguar...

NoPension's picture

Or that mini- Cadiilac, that turned out to be a badged up Chevette.

okyoureabeast's picture

More like Sum Ding Wong!



hibou-Owl's picture

Amateurs? Makes Bernie Maddoff look like a schoolboy. They're done a proper job.

Only issue Bernie's cell is likely to me quite nice, Ding will get a lead present or a job in the government depending on who he knows.

For the investers (Donators), same trick different show!

MayIMommaDogFace2theBananaPatch's picture

Madoff was able to keep his game running for years.

(and no one suspected! </sarc>)

WOAR's picture

"We're gonna need some bigger islands."


Funny, that there's a populist revolt at just about the time China was "catching up" with the United States. Just as soon as you start dreaming of another reserve currency, or begin pondering about how you should act upon the globe (mainly in Africa for this case), shit just starts to...


I wonder how many more chemical storage facilities are going to be hit with "lightning" within the next couple of months...


Pheonyte's picture

The Billion Man March

Father Thyme's picture

Might turn into the "Fists of Righteous Harmony" in Neal Stephenson's The Diamond Age.

12357111317's picture

One of my favorite books!  :-)

Tijuana Donkey Show's picture

Spendthrift to suck money. That is priceless. Who says AI translation can't read between the lines?

NoPension's picture

I would buy cheapo Chinese concrete vibrators. $100. For the limited amount of work I had, it did not justify $1200 real- deal.
Reading the owner's manual was complete comedy.

But then again, the joke's on us.

shovelhead's picture

Please to insert donkey dick in wet spot to apply furiously.

nmewn's picture

"Comrades! Do not flee into the streets with your hair on fire! We got this!" - regulator extraordinaire, Vice Public Security Minister Meng Qingfeng ;-) 

ThroxxOfVron's picture

Who do they hell do think they are demanding the return of thier capital and thretenting the government if it is not returned -Bankers???!

Omega_Man's picture

man that shit could get nasty... 

CHoward's picture

The ONLY thing the politburo in China fears is an uprising amongst it's people.  A massive protest would be devasting to them and could actually topple their government.  Anyone in for a China Spring?

swmnguy's picture

A peasant uprising has been the greatest fear of any ruler of China these past 5000 years.  And for good reason.

Joebloinvestor's picture

They executed (in public) two of the principals involved in the melamine in pet food scandal.

Two weeks later they caught someone else doing the same thing.


China, where even the death penalty is not a deterrent.

johnnycanuck's picture

Well they do have enough people to have 4 times the number of potential gangsters as the US, and look at how many the US has.

And your Prisons and Jails are the most heavily populated in the world.

laomei's picture

It's the culture of the place.  There are tons of famous stories here about how some ancestor did something sneaky to get a giant pile of money and property, then was caught, but their family remained rich for generations.  There is ancestor worship here.  In a few generations no one cares how your family got rich, must have been pretty smart! That's why they flat out do not care.  Take a billion or so, get it out of the country and into the hands of your family.  You get caught... so what?  Your family line is secure and you will be a hero to them in a few generations.. hell the government probably won't last that long anyways.

Lost in translation's picture

Good to see you posting more, laomei. Your insights on mainland China are much appreciated...

dchang0's picture

Good way to start familly feuds. It would not surprise me that right after the government collapses, the victims' families go in and kill everyone in the crooks' families. Very similar to how it is in other parts of the world that are more tribal or clannish in nature.

HardAssets's picture

Ah . . . maybe I'll be venerated by future family generations for keeping gold & silver, afterall. (The current generation of them are mostly clueless.)

NoPension's picture

Hey, just like the Kennedys! We know how it rolls.

ebworthen's picture

Is this like Madoff and the U.S.?  Perp walk, then "everything is fine" in the casino?

Dr. Engali's picture

Largest Ponzi ever known? Are we talking about social security or the stawk market?