Over the last few weeks, the sudden disappearance of Pan Jibiao, chairman of Golden Century International Holdings, became the most discussed topic and drew lots of public attention in China.
According to a The Paper report on November 22, Golden Century is a Chinese investment and financing intermediary. Over the years, the company has attracted a significant number of investors by offering an annual rate of return of about 14%-16%, much higher than the bank interest rate.
However, since early November, many have complained they no longer receive dividends and they haven’t been able to get their principal back. A few weeks later, the firm’s controller allegedly ran off with outstanding money, leaving Chinese investors in despair.
Upon an investigation into the case, Chen Xiangdong , deputy director of the Hunan Local Financial Supervision and Administration, told The Paper, “Our administrative law enforcement agency has determined that Golden Century has conducted illegal financing.”
Chen added that the administrative investigation has ended, and the judicial action has begun.
In addition, police in Changsha, where the company is headquartered, disclosed that on November 20 that the public security authority has not yet formally filed a case and still needs to gather more information for further investigation.
The Paper, citing multiple executives at Golden Century, reported that the number of investors who haven’t received their money exceeded 100,000.
Dr. Xie (pseudonym), the company’s CEO, also confirmed that the total amount unpaid was as high as $2.7 billion (19 billion yuan).
The outlet noted that Golden Century requires customers to make investments by paying “partnership funds” to its joint venture, while the company will just act as a service provider.
But according to Chen, Hunan’s investigators discovered that the joint venture was under the control of Golden Century. This means that the Changsha-based investment intermediary raised funds illegally.
Chen also revealed that Golden Century has not yet obtained a financial license despite its back door listing in Hong Kong.
Additionally, as reported by The Paper, when asked by a customer representative whether Golden Century’s operation is legitimate, Xie avoided answering the question.
On November 21, upon seeing a video screenshot circulated online showing 4 seal stamps found in Xie’s office, Hunan’s Chen immediately confirmed with the outlet that they are fake.
Chen further explained that the finance office engraved on the seals does not exist but became Hunan Local Financial Supervision and Administration since 2018.