Investors protest over crackdown on scheme

Chinese protesters in Beijing appealed to President Xi Jinping on Monday to overturn the crackdown on their investment scheme, called Shanxinhui, and the recent arrest of its founder, Mr Zhang Tianming.
Chinese protesters in Beijing appealed to President Xi Jinping on Monday to overturn the crackdown on their investment scheme, called Shanxinhui, and the recent arrest of its founder, Mr Zhang Tianming.PHOTO: HIHI947 TWITTER

BEIJING • Several hundreds of Chinese investors who paid into what police have called a pyramid investment scheme took to the streets of Beijing, not to denounce the business in which some had placed their life savings but to oppose the government investigation that threatened their earnings.

Many of the protesters waved Chinese flags, and some held banners appealing to President Xi Jinping to overturn the crackdown on their investment scheme, called Shanxinhui, and the recent arrest of its founder, Mr Zhang Tianming.

Ms Li Yinuo, a 31-year-old investor at Monday's protest, said she had travelled from her home in nearby Hebei province. "They call us a pyramid scheme, which is absolutely not true," she said. "We came here first to save ourselves and the platform. Second, we want Mr Zhang to be released. Mr Zhang is such a fine man."

But the government and state news media have described the investment scheme as a dangerous swindle that preys on the gullibility and generosity of people who like the idea of making money while helping others.

Last Friday, police arrested several people working for units of Shanxinhui, said state news agency Xinhua. Mr Zhang, the company's founder and legal representative, and several employees were arrested on charges of defrauding "a huge amount of property" from victims "under the guise of helping the poor and achieving common wealth", Xinhua reported.

Shanxinhui means "kind-hearted exchange", and the group has promoted itself more as a charity that happens to make money than an investment plan.

Ms Li, the investor, was defensive, saying: "What we sell to people is benevolence. When they first join the group, their purpose might be to make money. But as you get to know more about the programme, your main focus will shift to help other people. I've helped 17 members of the group with the money I earned from this programme."

RALLYING TO HER CAUSE

They call us a pyramid scheme, which is absolutely not true. We came here first to save ourselves and the platform. Second, we want Mr Zhang to be released. Mr Zhang is such a fine man.

MS LI YINUO, an investor, defending the scheme and its founder.

Hours after the demonstration erupted in Dahongmen, south of Tiananmen Square, police arrived to remove protesters from the site.

Yesterday, a statement from the police said: "Some members of Shanxinhui were incited by those with ulterior intentions to illegally gather in Beijing, seriously disturbing the capital's social order." The gathering is suspected of breaking laws and rules, it added.

The statement also said police persuaded the protesters to leave in an orderly manner. Those who "took the lead in creating trouble and refusing to listen to police orders" have been taken away for further investigation. Police said the activity was illegal and those who incite, organise and participate in illegal gatherings will be punished.

While protests over losses in investment schemes are not uncommon in China, the size and timing of Monday's protest was.

It is likely to be especially galling for the government, which prizes stability in the capital. Beijing will host a Communist Party Congress this autumn that will inaugurate a second five-year term for Mr Xi, who is party general secretary. The build-up to that meeting has intensified official worries about unrest in the capital.

NYTIMES, XINHUA

A version of this article appeared in the print edition of The Straits Times on July 26, 2017, with the headline 'Investors protest over crackdown on scheme'. Print Edition | Subscribe