Prosecutors warn of fraudulent loans schemes
Fraudsters are targeting patients, students and car buyers with illegal, predatory lending schemes, the Shanghai People's Procuratorate announced on Monday.
According to Yang Yongqin with the local prosecutor's office, some plastic surgery clinics have colluded with fraudsters posing as employers in order to cheat job-seekers into taking out private loans for cosmetic surgery. In such cases, fraud victims are duped into believing that changes to their appearance will help their chances of being employed.
Meanwhile, some private clinics, particularly those specializing in andrology and gynaecology, have been accused of asking patients to take loans for unnecessary surgeries.
Students were also trapped by illegal campus lenders and car buyers have been targeted as well for down-payment loans.
Procuratorates in Shanghai had charged more than 650 people in 260 cases of taolu dai, or fraudulent lending, over the past two years.
Fraudulent lenders use a variety of tactics to pressure their victims into taking out exorbitant loans with predatory terms. Fraudsters have been known to use intimidation, threats of lawsuits, forged documents and illegal confinement to extort their victims.
In one case released by Fengxian District People's Procuratorate, a gang of 14 con-artists was sentenced to up to 25 years in jail under charges such as illegal fundraising, fraud, making trouble and illegal confinement.
The chief culprit, a man surnamed Tang, registered an investment company in Fengxian in May 2013, which was used to provide illegal loans and raise funds from the public. He and his accomplices raised more than 500 million yuan (US$71.4 million) and used the money for lending.
When desperate borrowers couldn't make their payments, Tang asked the gang members to "take back" the money through intimidation tactics like spray-painting borrowers' houses and filing false lawsuits.
An investigation showed that the gang had committed 10 frauds involving over 7 million yuan.
