Private fundraising still vexes Wenzhou

The number of legal cases concerning private fundraising increased by 89 percent year-on-year in Wenzhou in the first four months of the year, according to a release by the Wenzhou Intermediate People's Court on May 21.

From January to April, courts in Wenzhou received almost half the number of cases they received for all of 2011. In the first quarter there were 6,510 cases involving some 3.85 billion yuan ($608 million), while 2011 cases totaled more than 12,044 and involved 5.4 billion yuan.

The figure shows that legal disputes concerning private fundraising are still increasing in frequency in Wenzhou in the aftermath of a widespread credit crisis in the city last year that led to a flight of borrowers and panic among lenders.

The court announced it has strengthened its crackdown on parties that escape financial liabilities. Wenzhou Lucheng district court has set up a finance tribunal, the first in Zhejiang province.