From Chinese Press

How to stop illegal fund raising

(China Daily)
Updated: 2011-06-14 09:26

Two principal culprits in the Yunan Jinzuo illegal fund-raising case were sentenced to death with reprieve recently. For two years from 2007, the company raised 480 million yuan ($74 million) illegally, but surprisingly no department warned or took measures against it, says an article in People's Daily. Excerpts:

Economic crimes that involve a large number of victims such as illegal fund raising have become frequent in recent years. Police in Kunming, Yunnan province, have detected 35 such cases with about 25,000 victims from March 2009 to March 2010.

Most of the illegal fund-raising schemes are deceptive. But it is not that hard to guard against and crack down on such "business".

Experts say one of the important reasons victims don't receive early warning against such activities and they cannot be curbed is relevant departments' slow response. In fact, many local governments have formed a joint forum of the banking regulatory department, industrial and commercial administrative departments and police against illegal fund raising. But because of unclear rights and liabilities of the departments, supervision is lax.

Only by specifying the departments' responsibilities and strengthening the accountability system can illegal fund raising be nipped in the bud and relevant units forced to fulfill their duty.

Though victims, too, have to shoulder their part of the responsibility of checking the pros and cons of such schemes, relevant departments should issue early warnings against illegal fund-raising activities that are hard to distinguish in the beginning.