As previously reported, on June 25, more than 300 depositors from various provinces at Henan rural banks protested peacefully in front of the Henan Banking and Insurance Administration. They reported the recklessness and irresponsibility of local officials, using their real identities.

The following day, in the sweltering heat of nearly 122 degrees Fahrenheit (50 degrees Celsius) in Henan, hundreds of deposit victims continued to protest at the gate of the Henan Banking and Insurance Administration, and some even set up tents to express their determination to protect their rights until the bitter end. Experts believe that while the Chinese government identifies this action as illegal and criminal “sweeping money” by private enterprises, preventing depositors from withdrawing funds, there may be more widespread financial upheaval at work.

Deposit victims are steadfast in defending their rights. 

Due to personal security concerns, one of the victims sending money under the fictitious name Chen Yu informed the Epoch Times on June 26 that he was not from Henan and that most individuals travel to Zhengzhou. There were barely a few dozen locals on the scene, and most of them were forced to perform the so-called stabilizing; they were only permitted to sit. If they refuse, those with jobs will be forced to quit, and those with school-aged children will be unable to send their children to school. 

According to Mr. Chen Yu, some people suffer from heatstroke yet refuse to seek care, demonstrating their commitment to protecting their savings even if it means compromising their health.

According to Tianmu News, on June 26, from 12:41 to 12:56, Xinfangdong Rural Bank in Kaifeng city unexpectedly established an online transaction system for 15 minutes before shutting down. Many depositors have yet to open balance transfer accounts, making it impossible to access their money.

Meanwhile, Xinfangdong Rural Bank’s official website still stated the closure of the internet transaction system. When a Tianmu News reporter called Xinfangdong Rural Bank, staff said they first learned about the matter after the depositor called the bank. The technical department is in charge of the online system; the other departments are unfamiliar with it. If the online system is officially launched, it will be announced as quickly as possible on the official account or website, said staff.

The public distrusts the Henan Banking and Insurance Administration

On June 25, depositors from several provinces and cities who had been victims of Henan rural banks put up a poster that read: “Henan rural banks cooperated with others to steal citizens’ money” and used their real identity to accuse local leaders.

Wang He, a political commentator, told The Epoch Times on June 26 that authorities are currently using financial fraud to delay repayment, so they are not conducting due diligence and initiating procedures under the “Deposit Insurance Regulation,” which allows the repayment of principal and interest on deposits up to 500,000 yuan (75,000 dollars). “They ignore the losses of depositors and even intercept and attack them. The so-called red code incident occurred, which is very bad.”

Expert: The expansion of rural banks could be the catalyst for China’s financial collapse.

According to Finance Sina, there were 1,651 village and township banks by the end of 2021, accounting for 36% of the total number of banking and financial institutions in the country. According to Central Bank of China data, 122 rural banks are high-risk entities as of the second quarter of 2021.

According to Wang He, 63 “leaders” of small and medium-sized banks in Liaoning province have been arrested since 2021. China’s Central Committee inspection team inspected financial institutions last October, and 17 top officials were sacked. “It demonstrates how serious China’s financial risks are. Small and medium-sized banks, as well as rural banks, could be the catalyst for China’s financial disaster. “

Wang He stated that the four major state-owned banks presently restrict internet deposit, withdrawal, and transfer transactions. According to the central bank’s Shanghai branch, in early June this year, cash distributions were nearly four times greater than that in the same period last year.

“This demonstrates that domestic demand for cash is expanding, and one of the major causes is a lack of trust in banks, and the risk of cash-swapping is likely to spread in some locations.”

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