Some investors in a troubled Chinese trust fund are facing financial ruin under a government plan to return a fraction of their money back. They are casualties of China’s broader troubles as the financial industry is squeezed by a slump in the property industry that has added to factors dragging on the economy.
Plainclothes policemen have a chat as they stand watch outside the barricaded Sichuan Trust office building in Chengdu in southwestern China’s Sichuan Province on Feb. 27, 2024. Some investors in a troubled trust fund in China are facing financial ruin under a government plan to return a fraction of their money, casualties of a slump in the property industry and a broader economic slowdown.
Women stand near security personnel outside the barricaded Sichuan Trust office building in Chengdu in Sichuan Province on Feb. 27, 2024. The troubles at Sichuan Trust first surfaced when the government began restricting new sales of trust products in 2020. Without revenue from new investors, it couldn’t pay its outstanding debts.
In 2021, police detained Sichuan Trust’s majority shareholder Liu Canglong, a mining and real estate tycoon who was once the richest man in Sichuan, a province of more than 80 million people. He is accused of embezzling trust funds. Those protesting fear say they’ve been harassed and intimidated, subjected to police interrogations and threats from their children’s employers. They’ve been barred from leaving Chengdu or, at times, their housing compounds.
Trusts have a high minimum investment — for Sichuan Trust it was generally 300,000 yuan — and many people believed mostly the relatively well-off were affected.
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