If someone told you that there was an equestrian club that undertook large-scale sports events and had an annual return on investment of more than 20%, would you be tempted? If the other party takes you on an on-site inspection and even the local person in charge comes to receive you, will you still have doubts? In Beijing, more than 500 people participated in project investment, 90% of whom were elderly, and the investment amount exceeded 160 million yuan.
More than 500 people invested more than 160 million yuan. What kind of project is it? Lecturer of the seminar: The company has acquired 260 acres of orchards in Shunyi, Beijing this year. There are geographical maps and satellite network maps of the orchards’ locations. Cherry, apple, peach, pear and other fruit trees are planted in the garden. It is estimated that the annual output value of cherries can reach a minimum of 3.6 million yuan, and that of peaches can reach 120,000 yuan. The value of this land can reach more than 30 million yuan.
Build an equestrian club, invest in Wagyu and red wine, and the profits will be attractive. This is a video of a company’s investment presentation. The speaker on the stage was a lecturer invited by the company, and those sitting under the stage were mostly old people holding pensions in their hands, hoping to earn more interest.
The person in charge of this company is named Feng. He has 21 companies under his name, and has promoted more than a dozen projects to the outside world: building equestrian clubs, orchards, woodlands; investing in Wagyu beef, red wine, etc. The investment returns from these projects are also very attractive, with annualized returns ranging from 12% to 36%.
Ms. Wang, who lives in Beijing, is one of the investors. A few years ago, she walked into this company for the first time after being introduced by a friend. Victim Ms. Wang: We were introduced by friends. At that time, we thought the office building in our company was very good. When we left, we also gave two kilograms of noodles and eggs as a gift.
In Ms. Wang's eyes, this company is grand and considerate, and it doesn't look like a scam. What made her even more tempted was the investment project the company introduced next. Victim Ms. Wang: The company launched a new project in the name of equestrian, saying it was a "project to participate in the Beijing Winter Olympics." However, they also had difficulties in getting loans. They hoped to raise funds among ordinary people. The annualized rate of return they gave us was 20% and 22%, with the highest being 24%.
Although excited, I still had doubts, and the company offered to conduct an on-site inspection. This project claims that the annualized return is more than 20%, which is more than ten times higher than bank interest. Can such a good thing really happen? Although Ms. Wang was moved, she still had some doubts. Immediately afterwards, the company proposed to take everyone on an on-site inspection.
Victim Ms. Wang: Organized us to visit a county in Hebei Province and used 10 buses, all of which were covered with advertisements. After arriving, so-called "government personnel" received and explained the project, saying that the project would build an equestrian club, an equestrian base, and an equestrian education base here. All the surrounding villages would be demolished, and the scale of the project was simply huge.
After returning from the inspection, I was convinced of the project investment. For such a large project, the local person in charge also received and explained it. After returning from the inspection, the old people including Ms. Wang were convinced. Next, some actions of Feng, the person in charge of this company, caused many elderly people to invest their retirement money.
Victim Ms. Wang: Feng disclosed his ID card, house book, and home address to the elderly, claiming, "I won't lie to you." "This is my ID card. I'll put it all behind." "If I lie to you, sue me." He also said that he was too young to go to jail. He was senior and junior, and his words were very realistic.
The ID card and house book were published, and the old man's concerns were completely dispelled. The ID cards and house books were all placed in front of everyone, and the old people's concerns were completely dispelled. Next, like many old people, she signed a contract and paid money. Ms. Wang invested 500,000 yuan in this project.
In addition to equestrian projects, many elderly people also invest in woodland projects. The company claims that this project not only has very generous returns, but also has very strong guarantees. Lecturer at the seminar: The safety factor is the same as what we have seen. It is a product officially listed on the Tianjin Exchange. It represents the government and the country to review for everyone. It is guaranteed and can be said to be a 100% safe product.
Victim Ms. Wang: He also launched the Northeast Forestry Project, saying how many acres of forestland he had developed could raise fungus, chickens, and pigs, and everyone would benefit. He also issued a so-called "Property Certificate of the People's Republic of China" that could be used for bank loans and mortgages.
Company staff also said that this forestry project not only has an annualized income of 20%, but also provides 5% of forestry crop profit dividends every year, and as long as you subscribe for more than 5 acres, you can get a forestry property rights certificate with your name on it. The old people invested hundreds of thousands or millions of yuan.
Most of the investment projects of this company have contract terms of one or two years. After the contract expires, the salesperson will come to the door and persuade the investor to transfer the money to the next project and sign a new contract.
The person in charge of the company, Feng, often records videos and holds member meetings. Every time he claims that the company is making profits, he also tells the data to the elderly so that everyone can continue to invest money in the project with confidence. Defendant Feng: Our business achieved a performance of about 15 million yuan in January. There was a substantial increase in February, reaching about 23 million yuan. We have very good profits. We will pay dividends to shareholders in April. In the new year, we will have a performance increase of 100 million to 120 million yuan.
According to Feng, the person in charge of the company, the company's prospects are limitless. However, starting from the end of 2020, investors will no longer be able to get money for their expired contracts.
Victim Ms. Wang: We signed a one-year or two-year contract. After we invested the money, he closed the business. Some contracts did not expire, and some did not pay us any money after they expired. They found various reasons, such as the company was going public, the card number was frozen, and the company's accounts were closed.
The office building was deserted and the person in charge of the company lost contact. The old people couldn't get paid when their contracts expired, and the offices were empty. Even Feng couldn't be contacted. More and more investors finally discovered that something was wrong and reported the case to the public security organs. In October 2022, Feng was captured and brought to justice.
They have no financing qualifications, promise high rebates, and specialize in defrauding the elderly. The case handling agency found that from 2018 to 2021, Feng, together with others, used a number of companies he actually controlled as a platform, without approval from the financial regulatory authorities and without financing qualifications, in the name of promising to return principal and interest, and high rebates, through publicity sessions, leaflets and other methods to publicly publicize and raise funds to the society.
After auditing, more than 500 people have participated in investment, and a total of more than 160 million yuan has been raised. The money was not invested in the project as promised, and most of it was used to pay the upfront principal and interest, personal consumption and other expenses of the company. The funds raised for operating activities are obviously disproportionate to the scale of funds raised. In the end, investors lost a total of more than 110 million yuan.
In January 2024, the People's Procuratorate of Haidian District, Beijing, prosecuted Feng for the crime of fund-raising fraud.
How to defraud the elderly with careful packaging and layers of traps? More than 500 victims, more than 100 million in funds, the numbers are shocking. How do these scammers carefully package and set up layers of traps to deceive so many elderly people?
Fraud method one: packaging fake projects and fabricating high returns. Wang Luyue, assistant prosecutor of the People's Procuratorate of Haidian District, Beijing: They have prepared flyers on related projects and distributed them to the elderly on the streets. It focuses on equestrian clubs and claims to be an emerging sport strongly supported by the country. Everyone can come to him for investment. He does all the projects that can be heard in the market, such as investing in orchards, woodland, forest economy, equity, adopting Wagyu cattle, supplying high-end red wine to large supermarkets, etc. These projects are actually very traditional and can be seen and touched by the elderly, so they will trust this thing very much.
The pension project is in name only, but in reality it has been losing money. After investigation, most of these projects were in name only. The elderly care project Feng mentioned was something he took over from others for 200,000 yuan. It provided services such as door-to-door pedicures and haircuts. In fact, it had been losing money. The total taxable income of the elderly care company under his name was only 8 yuan in several years, and the company was canceled in November 2019.
Fraud method two: Using official endorsement in the name of investment promotion. The victim mentioned that when they followed Feng to inspect the project, the so-called "local leaders came forward to explain". What happened? Wang Luyue, assistant prosecutor of the People's Procuratorate of Haidian District, Beijing: He used the image of an entrepreneur representative to negotiate with the local government and defrauded these investors, saying that we actually had official endorsement.
Fraud method three: organize on-site inspections and forge guarantee certificates. Field trips are organized just to give the elderly reassurance. In order to completely convince the elderly, the company leader Feng regularly organized them to visit project sites such as racecourses and orchards, and also held frequent presentations to exaggerate the prospects of the project and claimed that many units would guarantee the project. The purpose was just to reassure everyone. After combing through the evidence, prosecutors found that all this was just a carefully choreographed performance.
Wang Luyue, assistant prosecutor of the People's Procuratorate of Haidian District, Beijing: When inspecting the racecourse, we will also make corresponding arrangements and rent some horses to make everyone think that the project is indeed in operation. He also took everyone to visit the orchard and hung up a banner saying that it was a project of the company. But in fact, no one can say how much this project has to do with him.
As for the multiple units that Feng mentioned as guarantees for the project, as well as the property rights certificate that investors can obtain, they are all fake. Wang Luyue, assistant prosecutor of the People's Procuratorate of Haidian District, Beijing: After review, it was found that Feng's documents were fake. There was no official certificate of issuance and they were all forged by his company. He also claimed that the project has been certified by the government, notary office, bank and third-party guarantee company, which is very false.
The Haidian District People's Court of Beijing made a first-instance verdict on this case. The defendant Feng was guilty of fund-raising fraud and was sentenced to 14 years and six months in prison and fined RMB 1 million. Feng was dissatisfied and appealed. The second-instance ruling of the Beijing No. 1 Intermediate People's Court rejected the appeal and upheld the original judgment.
Details of the case were announced recently. Prosecutors reminded that for investment and financial management, you must look for formal financial institutions, and be more vigilant about any projects that promise guaranteed principal and interest, and high rebates; seemingly formal "government background" and "official endorsement" may also be packaged.
Wang Luyue, assistant prosecutor of the People's Procuratorate of Haidian District, Beijing: Many elderly people's 30,000 yuan or 50,000 yuan is life-saving money, money for medical treatment, and money for children's schooling. Whether these small favors or high rebates, they are all aimed at the money in your hands.
