Angry investors drag executive from hotel to police station

folarin okunola

August 24, 2015 1:17 PM

A mob of "hundreds" surrounded a luxury hotel where Shan was staying at dawn on Saturday after being fed up with the perceived inaction in Shanghai.

China's Flag.

The head of a Chinese exchange, Shan Jiuliang, found himself in a difficult position over the weekend, when an angry mob of investors marched to the hotel he was staying at, forced him into a car and took him to the police station.

Jiuliang is the founder of Fanya Metals Exchange, and investors have been pounding on its doors demanding their money back for some months now.

READ: Shares in Shanghai fall by more than 5%

A mob of "hundreds" surrounded a luxury hotel where Shan was staying at dawn on Saturday after being fed up with the perceived inaction in Shanghai.

The FT reports that when the Fanya founder tried to leave, they manhandled him into a car and drove him to the police. Reports say Shan has since been released without charge.

Xinhua says the elephant in the room for investors is one of Fanya's financial products, Ri Jin Bao. It was marketed and sold with the promise of the right to withdraw funds at any time, but Fanya held on to those funds in April when the bourse ran into cash problems.

The report further says that an estimated 40 billion yuan (US$6.3 billion) from 220,000 Chinese investors is still in limbo.

READ: Trade deficit growths by wide margin as exports slow down

This informed a protest in July with about 800 angry investors staging a demonstration outside Fanya's headquarters in Kunming.

Quartz reports that several days after, another set of 200 investors in Shanghai gathered to demand their money back from officials.

Some days after the protests, Fanya said in a statement that it would buy back 5 billion yuan (US$787 million) worth of investments with money from partners. It has been silent on the whereabouts of the rest of the money so far.

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