Since April, six illegal securities exchanges have been tracked down through the joint efforts of the Shanxi Public Security Bureau and the Taiyuan Branch of the China Securities Regulatory Commission. All the suspects involved were arrested and their illegal activities halted.
Earlier this year, some people opened illegal securities exchanges in Taiyuan, Linfen and other areas of the Shanxi Province to take advantage of the public's enthusiasm in investment. By false tricks, such as promising to provide free computers to investors or allowing investors to gamble for a higher percentage of finance, these illegal exchanges took many innocent investors for a ride.
Most of the underground exchanges engaged in illegal transactions of securities in the guise of investment consultation. To lure investors, some of them synchronized their computer network with that of the stock market, and equipped them with a simulated securities exchange system. They then operated just like their real counterparts, taking transaction fees and even inviting experts to give investment lectures. However, orders signed at these exchanges could never be carried out. Instead, all the funds were transferred to private accounts.
Once informed of the alleged scam, the Security Bureau of Shanxi Province and the Taiyuan Branch of the China Securities Regulatory Commission quickly tracked down the six illegal exchanges, including Taiyuan Huihe Finance Consulting Co., Ltd, Taiyuan Jinxuan Company and Jinsheng Investment Consulting Co., Ltd of Gujiao City. The case involved nearly 10 million yuan and over 300 victims.