Special Forces Confront Chinese ‘Investors’ Demanding Failed Trust “Pay Back Our Money”

“We have been cheated by CCB,” exclaimed one Chinese investor who invested 1 million yuan ($160k) in China Construction Bank’s Songhuajing River No.77 Trust (which offered returns of 9.8 to 12% per annum). It appears that a 12% yielding financial instrument was not hint enough of the risk to the dozens of investors who confronted police in troubled Sanhxi province yesterday demanding their money back from the trust which has missed 6 monthly payments in a row. People wearing white masks with the words “despicable bank” and “pay back our money” were among at least 30 investors facing special-forces officers in dark uniforms and the group dispersed soon after the bank had asked for more time, adding “the bank said they wouldn’t risk their reputation.”

“Investors” are not happy that their high-yielding incredibly risky asset has the potential for loss…

Chinese investors demanding their money back from a troubled 973 million-yuan ($156 million) high-yield product in Shanxi province were confronted by police in front of a China Construction Bank Corp. branch.

People wearing white masks with the words “despicable bank” and “pay back our money” were among at least 30 investors facing special-forces officers in dark uniforms in Taiyuan city, about 521 kilometers (324 miles) southwest of Beijing. The nation’s second-largest bank is the custodian of the Songhuajiang River No. 77 trust, which missed six payments as of last month, according to the Economic Observer.

“We have been cheated by CCB,” said Wang Fengying, 60, a Shanxi resident who said her husband had invested 1 million yuan.

And here is the product…

State-backed Jilin Province Trust Co. created the Songhuajiang River No. 77 product to raise funds to finance mining projects for Shanxi Liansheng Energy Co., the biggest private coal miner in the province, according to a contract for the product obtained from Li Taishan, the leader of the investors gathering in Taiyuan.

The trust offered investors an annual return of 9.8 percent to 12 percent,depending on the investment amount, with a minimum of 1 million yuan, the product contract showed. Construction Bank currently pays 3.25 percent on one-year time deposits, according to its website.

“They told us the interest rate is three times the bank saving rate,” Wang, the woman whose husband had invested in the Songhuajiang River trust, said. “They said they wouldn’t risk the bank’s reputation. It’s our hard-earned money.”