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Convictions are Rare in P2P Lender Swoop


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(YicaiGlobal) Feb. 17 — Cases have been opened against less than 5 percent of the thousands of platforms in China’s emerging peer-to-peer lending industry that were deemed problematic in the past three years, according to an industry report.

As of the end of January, 1,811 problematic P2P lending platforms have been identified since 2014, according to a report from Wdzj.com. Only 22 were ultimately convicted in cases with a combined value of over CNY1 billion (USD146 million).

Heads of the 22 convicted lenders were accused of charges including contract fraud, embezzlement, illegal absorption of deposits from the general public and illegal fundraising, investigations show. Compared to the possible loss of investors, penalties and sentences imposed on such leaders are not harsh.

Since problematic sites involve many investors scattered across the country and it is difficult to obtain evidence, it usually takes a long time to process such cases, the report indicated.

The main reason few cases have been opened against online lenders and court decisions are rare is that gathering evidence is time consuming, said Zhang Yexia, senior researcher at Shanghai Yingcan Business Consulting Co. Many victims choose not to file a case against small problematic platforms, as the amount of money involved is minimal.

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Heads of the 22 convicted lenders were accused of charges including contract fraud, embezzlement, illegal absorption of deposits from the general public and illegal fundraising, investigations show. Compared to the possible loss of investors, penalties and sentences imposed on such leaders are not harsh.

Since problematic sites involve many investors scattered across the country and it is difficult to obtain evidence, it usually takes a long time to process such cases, the report indicated.

 

Heads of the 22 convicted lenders were accused of charges including contract fraud, embezzlement, illegal absorption of deposits from the general public and illegal fundraising, investigations show. Compared to the possible loss of investors, penalties and sentences imposed on such leaders are not harsh.

Since problematic sites involve many investors scattered across the country and it is difficult to obtain evidence, it usually takes a long time to process such cases, the report indicated.

 

Heads of the 22 convicted lenders were accused of charges including contract fraud, embezzlement, illegal absorption of deposits from the general public and illegal fundraising, investigations show. Compared to the possible loss of investors, penalties and sentences imposed on such leaders are not harsh.

Since problematic sites involve many investors scattered across the country and it is difficult to obtain evidence, it usually takes a long time to process such cases, the report indicated.

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