Fanya Metals Exchange investors protest
September 28, 2015 Category Finance, Weekly
Investors in financial products of the Fanya Metals Exchange in Yunnan province protested in Beijing after they could not withdraw their investments. More than 400 of these so-called commodity exchanges have mushroomed in China in a regulatory void and attracted CNY1 trillion in investments. They are now all under scrutiny. The angry investors, wearing T-shirts calling Fanya a “scam”, demanded the central government investigate Fanya for defaulting on CNY36 billion it owed investors. The exchange had promised double-digit returns on a punt on metal prices increasing, a bet that went wrong as commodity prices collapsed worldwide. “The China Securities Regulatory Commission (CSRC) does not have the power to regulate regional exchanges,” said a CSRC source who did not want to be identified. Geng Shuang, Senior Lawyer based in Guangzhou, said: “Spot markets come under the ambit of the Ministry of Commerce while securities and futures markets are under the CSRC. These so-called spot-trading exchanges are structuring contracts and complicated financial products based on commodity spot prices, creating a regulatory uncertainty. As a result, neither the Ministry nor the CSRC minds them at present.” China Financial Trading, an industry data provider, has identified 653 commodities exchange houses in China trading more than 200 commodities on their platforms. The Fanya exchange, which claims to trade 14 minor and rare metals, including indium, bismuth, tungsten, antimony and cobalt, is an example of the risks that such exchanges present, the South China Morning Post reports. Fanya’s product, named “ri jin bao”, promised an annual return of 13.68%, guaranteed principal and instant redemption. It could be bought online by retail investors all over China.
- KURT VANDEPUTTE (UMICORE) APPOINTED CHAIRMAN OF THE BOARD OF THE FLANDERS-CHINA CHAMBER OF COMMERCE (FCCC)
- Webinar: “Knowing Your Chinese Partner” – May 26, 2021, 10 am – 12 am
- EMA starts rolling review of CoronaVac, WHO approves Sinopharm vaccine for emergency use
- The Global Times warns not to politicize the Comprehensive Agreement on Investment (CAI)
- Hainan to become biggest duty-free market in the world