Beijing court upholds verdict on P2P fraud

A court in Beijing on Wednesday rejected appeals by executives of a Chinese online peer-to-peer (P2P) company, who were given jail terms for cheating the public out of large amounts of money.

In September, the Beijing No. 1 Intermediate People's Court ruled that Yucheng Global and Anhui Yucheng, operators of online P2P operator Ezubao, were guilty of fraudulent fundraising and smuggling precious metals. They were ordered to pay fines of 1.8 billion yuan ($273 million) and 100 million yuan, respectively.

The 26 company executives and staff, including Yucheng Chairman Ding Ning and his younger brother Ding Dian, were convicted of stealing public deposits, smuggling precious metals, illegal possession of guns and travel illegally. They were given jail terms ranging from three years to life imprisonment. They were also deprived of political rights and issued fines.

The two companies accepted the verdict, while 23 defendants appealed to the Beijing court, which affirmed the original judgment in the final verdict.

Anhui Yucheng and Yucheng Global raised a huge amount of funds by faking high-yield investment products on two online P2P platforms, Ezubao and Sesame Financial, without a banking license, the court said.

Most of the money was used on luxury gifts and salaries for top executives, while some of it was used to return principal and pay high interest rates to some investors.