As reported on July 10, a large-scale protest by depositors to ask for their rights broke out in Zhengzhou and was later violently suppressed by the authorities. Information about the incidents was censored and controlled on the Internet. 

On the evening of July 11, the Henan Banking and Insurance Administration issued another notice stating that, as of July 15, deposits of 50,000 yuan ($7.500) or less will be paid in advance, indicating that the authorities intend to cool the case down quickly. 

Some analysts say that, from protecting the interests of the original depositors to maintaining the current official stability, the case not only affects Zhengzhou and Henan officials, but if it spreads further, it will affect the general atmosphere of the 20th National Congress of the CCP.

The largest street march and protest in China since the pandemic outbreak (2020) took place on July 10 in Zhengzhou city, the capital of Henan province. About 3.000 depositors are said to have gathered outside the Zhengzhou branch of the People’s Bank of China, demanding the return of their savings.

But around midday, the crowd demanding their rights was surrounded by police and unidentified men in white, and bloody clashes broke out at the scene. News of the incident quickly spread on Chinese social media but met official censorship and mass deletion of posts.

At the July 10 event, human rights activists displayed black and white banners such as “Liberty, Equality and Justice” and “Anti-oppression, Human Rights and Rule of Law!” They also targeted the ‘No complaints, no incidents and no cases’ policy of Lou Yangsheng, Secretary of the Henan Provincial Party Committee, and shouted the slogan “Li Keqiang! Inspect Henan!”

On the evening of July 10, the Henan government issued two urgent notices.

The Henan Provincial Financial Supervision and Administration Department announced that “the settlement plan will be announced in the near future.”

The Notice of the Xuchang City Public Security Bureau said that the incident of Henan Rural Bank was that “Lu Yi manipulated the bank executives” to control some rural banks. He illegally sold financial products and transferred money through third-party Internet financial platforms.

Still, the masses were not appeased.

On the evening of July 11, the Henan Banking and Insurance Administration issued another notice stating that from July 15, advance payments will be made to depositors of 50.000 yuan or less, and if the total amount is more than 50.000 yuan, the advance payment option will be notified separately.

Immediately after the announcement was made, it once again caused a stir among netizens. Sound of Hope has compiled some comments from people as follows:

“Want to use 50.000 yuan to buy peace? It will certainly cause more injustice”;

“What about 50.000 yuan or more?”

“It’s all just tricking people, with no sincerity.”

“Twice red code and a scuffle. In exchange for cash. What about beating people yesterday?”

“We haven’t received the deposit yet. Why pay in installments, giving no more than 50.000 yuan? Why beat us, why contact the local uncles (implying police officers) to prevent us from going to save our lives, why give us a red code?”

“How long until the second batch is announced? Half a year? Or is there another July 10 incident?”

“We are savings depositors, so we must be paid principal and interest. How did we become non-business customers? The principal also has to be advanced in installments according to fund recovery; depositors will never agree!”

“Obviously in the account, why say it is out of the account. Return the depositors’ money!”

Chinese media attack Lu Yi, whose ‘white collar’?

The announcement of the Xuchang Public Security Bureau on July 11 said that Lu Yi had controlled several rural banks such as Yuzhou and Xinminsheng by manipulating bank executives, using a third-party Internet finance platform and a self-run platform developed by Junzheng Zhida Technology. He also used a group of fund brokers to block the storage and advertising of financial products, illegal money transfers using fictitious loans, etc. He especially established Chenyu Information Technology Company to delete, modify data and conceal reports.

According to state media, although Lu Yi is the de facto controller of Henan New Fortune Group 河南新财富集团), his name cannot be found in the information registered by the Ministry of Industry and Commerce.

In addition to his fundamental controlling role of Henan New Fortune Group, Lu Yi is also Evergreen TV International Media Group Chairman in New York, USA. This is a red media, its purpose is to “tell China’s good story” abroad.

According to Sound of Hope, entrepreneurs like Lu Yi are typical in China. They wear red hats abroad, tell so-called beautiful China stories, and return to China to collude with businesses and governments to transfer ordinary depositors’ money abroad.

Lu Yi’s ability is indeed very strong. In addition to 6 rural banks related to Henan New Fortune Group, which is widely known today, according to incomplete statistics, there are 26 banks with close links with Henan New Fortune Group. These banks eventually became the tools for large shareholders to suck blood through share mortgages and other means.

In February 2022, Cai Esheng 蔡鄂生, Vice Chairman of the Banking Regulatory Commission of China, was investigated for bribery. Lu Yi assisted with the investigation, showing that he had deep ties to the government side system and was a typical ‘white collar.’ ‘White collar’ is a term on the Chinese political scene, referring to someone who acts as an intermediary to whiten “black money” for corrupt officials.

In addition, based on the displayed banners, this time the depositors directly targeted Lou Yangsheng, the Secretary of the Henan Provincial Party Committee. Lou Yangsheng, appointed to the Secretary of the Henan Provincial Party Committee in June 2021, is an important member of Xi Jinping’s faction.

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