Businessman gets life in prison for fraud, illegal fundraising

Wu Youjian, the founder of Yan Shang Group, was sentenced to life imprisonment for fraud and illegal fundraising, the city’s intermediate court said on Friday. Six associates of Wu were also given sentences ranging between five and 15 years for the same crimes.

Shanghai No. 1 Intermediate People’s Court said during Friday’s hearing that the 48-year-old founder used the lending and financing platforms under Yan Shang to sell fake financial products, offer fake investment projects and provide fake accounts receivable. The company illegally raised 5 billion yuan (US$714 million) online and offline between 2014 and 2018.

More than 16,000 victims suffered direct economic losses of over 1.6 billion yuan, according to the court.

The company and Wu were fined 70 million yuan and 30 million yuan, respectively. The other six were fined between 500,000 yuan and 2 million yuan, the court said.

Yan Shang was founded in the Pudong New Area in 2012 and its business scope covers finance, real estate, trade and cultural communication.

In April last year, the police said that 117 platforms were being investigated for illegal fundraising. These included a number of platforms operated by Yan Shang.

Authorities say they are still in the process of recovering ill-gotten gains.