Furious investors have kidnapped the head of a Chinese exchange for minor metal trading from his hotel and handed him to police, the Financial Times (FT) has reported.
The investors were angry that authorities had failed to find out why their funds had been frozen and believed by handing over Fanya Metals Exchange boss Shan Jiuliang to police they could spark an investigation.
The FT reported investors had been protesting for weeks about their funds being frozen at the exchange which is based in the southwestern city of Kunming and traded minor metals. It also offered high interest investment products from offices in Hangzhou and Kunming.
The exchange, which had purchased minor metals for above market prices, has faltered as China’s economy slowed.
Investors travelled to Hangzhou and besieged a luxury hotel where Shan was staying.
When he tried to check out they manhandled him into a car and delivered him to the nearest police station, according to the FT report published on August 23.
Police took Shan into custody promising to investigate what happened to investors money. Shan was later released without charge.
Fanya, which had started to experience liquidity problems months ago, had stockpiled metals as Indium and Bismuth that are used in high tech and military applications.
The FT said it interviewed investors who claimed they were attracted to invest in Fanya financial products because it was advertised on CCTV – the national broadcaster.
Shan had been holding regular meetings with exchange backers and was on the way to Guangzhou for a business trip when he was captured.
According to the FT, a report by the local regulator had identified the exchange as an investment risk but was redacted to remove the reference to Fanya last year.