According to the Guangzhou Intermediate People's Court, Lin took the opportunity of opening a piano store to absorb funds from dozens of students, parents and the public in the name of cooperating in investing in pianos to earn high commissions4.3 billion yuan, and was finally sentenced to 10 years in prison and fined 500,000 yuan for the crime of illegally absorbing public deposits.
Lin registered and established Bo in 2014, with the main business of selling pianos and training students to practice pianos, and Lin is the legal representative and responsible for the operation. Since 2018, Lin has been in need of funds to expand the scale of operation, on the grounds that he can earn commissions for investment and cooperation in the purchase of pianos, he has absorbed funds from students, parents and the public, and promised to pay investors 5%-6% of the commission for each order for a period of one month.
Since July 2020, due to the impact of the epidemic and the difficulty in the turnover of the operating funds of the music store, Lin has absorbed more investment funds from investors by fictitious piano order volume, which is not only used to return the principal and interest of investors, but also used to make up for the operating losses of the music store and personal investment in real estate. In the end, the principal and interest that needed to be returned became increasingly huge, and Lin voluntarily surrendered after the capital chain was broken.
According to the audit, from 2018 to 2022, Lin illegally absorbed about 2 of the funds of 29 investors4.3 billion yuan, and when the case was pronounced, there were still 22 investors with a total of more than 18.41 million yuan unpaid.
The Panyu District People's Court of Guangzhou City ruled in the first instance that Lin was guilty of illegally absorbing public deposits and was sentenced to 10 years imprisonment and a fine of 500,000 yuan; Lin was ordered to make restitution of more than 18.41 million yuan to the victims. The verdict is now in force.
What the judge said. Illegally absorbing deposits from the public refers to the act of absorbing funds from unspecified targets without the permission of the financial management department or in violation of the state's financial management regulations, by promising to repay principal and interest or giving other investment returns. This behavior harms the property rights and interests of investors, disrupts the normal economic order, and has serious social harm.
In this case, Lin, as the operator of the piano store, absorbed funds from the parents of the students under the pretext of investing in cooperation to purchase pianos to earn commissions4.3 billion yuan, resulting in a large number of trainees unable to complete the training course, but also suffered serious property damage. The court sentenced Lin to 10 years in prison for the crime of illegally absorbing public deposits, which is a severe blow and a strong deterrent to illegal fund-raising such as illegally absorbing public deposits.
After the verdict was pronounced, the court issued a judicial recommendation to the relevant departments in response to the loopholes in the audit and supervision of off-campus training institutions exposed by the case, and put forward suggestions such as strengthening the audit and supervision of enterprises and strengthening information disclosure, so as to discover and eliminate risks and hidden dangers as soon as possible by strengthening the linkage of multiple departments.
Text: Beijing Youth Daily reporter Li Tiezhu.
Edited by Dynasty.