The Ministry of Public Security in China revealed that it had apprehended 41,000 loan sharks in the country. The apprehended criminals were said to be involved in illegal online lending and are currently detained due to an outstanding loan amounting to 57.7 billion Yuan.
A report from China.org.cn revealed that the many company victims of loan sharks were found to be oblivious to Chinese loans and lost significant amounts of money to repay their loans. It was revealed that their naïve disposition of the law led them to believe that the loan sharks were offering them qualified loans.
The verdict of the scheme was found in May and June when Chinese authorities determined that a criminal gang led by Wu Yongjie had been offering loans to Chinese citizens and charged them with excessive rates of interest. The victims of the criminal gang were said to have broken several laws to repay their debts with the loan shark criminal gang.
Last October 18, 2019, a court in Linhai, Zhejiang province settled a major case that involved loan sharks. The settlement resulted in the incarceration of the defendant to 15 years in prison and was fined with 800,000 Yuan.
The case involved Lin who went to the Wenling, Zhenhang police station and reported that on April 26, 2019, he was compelled to settle a debt amounting to 200,000 Yuan after he had defaulted in his payment for a small amount of 1,500 Yuan.
The report explained that Lin borrowed the money online from a company in Fuzhou. Lin claimed that he was contacted during February of 2019 to repay his debt in full amount within just five days or incur a huge interest rate as a top-up to his loan. He was also told that he would be charged with a 500-Yuan fine for every hour that he failed to pay such a loan. He was also asked by the online company to write a promissory note that indicated he would pay 3,000 Yuan.
It was later found that Wu, the leader of the criminal gang, had been running a network of 14 online loan teams since February 2018 and had been charging exorbitant interest rates to their loan clients. The process was illegal and prohibited under Chinese law. He was convicted of fraud and racketeering in the case where 170 people who worked for him were also convicted.
The report also showed that the criminal gang had illegally loan about 290 Yuan to 90,000 clients and that six of them committed suicide due to the company's illegal demands for repayment.
In other news, Nippon reported that China's economic growth has slowed down because China is suffering from excessive liabilities of companies and nonperforming loans of banks. Thus, loans have caused a financial crisis in China, which could consequently affect the global economy.
