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By Guqing' er 10/09/08
CHINA—Although the large protest gainst alleged illegal fundraising was quashed by military police in Jishou City, Hunan Province, people have little confidence in the government’s promises to “return their investment in three months.”
According to official news, a special investigation team started the liquidation audit work on September 7.
Mr. Yao, who knows inside sources, disclosed to The Epoch Times that the undisclosed amount of the scandal has reached 13 billion yuan (approx. US$1.9 billion), far exceeding the initial estimate of 7 billion yuan (approx. US$1.02 billion). The current estimate is that it will exceed 20 billion yuan (approx. US$2.9 billion), and involves investors from the entire western area of Hunan Province, Guizhou Province, and the Tongren area.
Rampant Bank Runs
Yao said, “This thing is not finished, although people have become quiet, many military police and special police have not left yet.”
On September 8, local banks were full of people because unofficial news circulated that the local regime is going to freeze all investors’ bank accounts on September 10. Many people were still lining up at the ATM after 9:00 p.m. on September 8. Some even went to neighbouring cities to retrieve their money.
Local resident Mr. Li told the Epoch Times reporter that all the money in the local banks had been withdrawn by the evening of September 8. Many people came back to the bank the following morning on September 9, however large numbers of riot police were waiting there already, and many also patrolled the streets.
Three Fund Raising Records Broken
Li said, “This illegal fundraising has established three national records: largest number of investors involved, largest amount of money raised, and highest interest offered.”
Mr. Zhang, who worked at a local shopping center, believes at least 90 percent of the local residents are involved in the investment. Many people now are just watching and waiting.
Ms. Jiang, a local farmer, told the Epoch Times that she invested all of her family’s savings, 20,000 yuan (approx. US$2,923), “Currently we don’t know what to do, we are waiting for the government. On September 7, over a hundred went to ‘San Guan’ (the real estate company involved in the scandal), but they only saw a large number police.”
A female investor said she invested 80,000 yuan (approx. US$11,695), “it is a large sum for a working class person like me, the fund raising was approved by the government, now it is investigated by the government. Without government permission, how could it operate for the past six years…the first ones to pull out their money are [government] officials, the victims are all everyday people.”
Mr. Yao also disclosed that many retired and unemployed workers also invested in the scandal and some even borrowed money to invest.
Waiting for the Promise to Be Realized
The local regime promised the investors that it would solve the problem within three months, but Mr. Li said, the local real estate market is experiencing a down turn, many developers have fled because they don’t have money. “The government wants to calm down the people. It promised to refund their investment in three months; so many people are impatiently waiting.”
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