Illegal fundraising crackdown to step up

China will intensify its crackdown on illegal fundraising by enhancing regulation, pushing forward the construction of monitoring and alert systems by local governments, and strengthening inspection of illegal fundraising activities.

Yang Yuzhu, director of the office of the interagency task force leading the crackdown on illegal fundraising, said on Wednesday it will carry out comprehensive inspections on how well local governments have implemented the State Council's guidelines on further improving efforts to prevent and deal with illegal fundraising.

"The interagency task force will urge directors and regulators of relevant sectors to accelerate the improvement of regulatory measures and step up everyday supervision and risk control, especially in several key areas where illegal fundraising cases occur most frequently, including peer-to-peer lending and crowdfunding," he said.

In 2015, the number of newly occurred illegal fundraising cases in China increased by 71 percent year-on-year. During the same period, the amount of money involved rose 57 percent and the number of people involved increased by 120 percent. All these figures hit a historic record.

A growing number of criminals pretended to cater to the public demand for preserving and increasing the value of their assets. Incomplete statistics show that illegal fundraising cases disguised as various forms of investment and wealth management accounted for more than 30 percent of the new cases.

Zhang Xiaojin, deputy director of the investigation and supervision department of the Supreme People's Procuratorate, said: "Illegal fundraising is usually under the cover of so-called financial innovation. Procurators have to think further and do more research on how to precisely grasp the boundaries of illegal and legal activities to keep a balance between combating crimes and protecting innovation."