Liu Yonghao, chairman of New Hope Group, is involved in the Xinwang Bank controversy.
The China Banking Regulatory Commission issued a notice on Thursday (18) criticizing Xinwang Bank for irregularities after being reported by customers for 1.5 years. People with knowledge of the matter said that Xinwang Bank, in conjunction with Murray Car Finance, had issued usurious loans, and that both companies were backed by the New Hope Group as their major shareholder, while the red background of Liu Yonghao, the owner of New Hope, attracted attention. However, not only did the authorities fail to take appropriate action against them, the shady business was even blocked in the media and online.
The briefing by the Consumer Rights Protection Bureau of the CBRC listed four major consumer reports against Xinwang Bank, including problems with irregular lending, disagreement over the amount of car loans, high interest rates on loans and violent collection of outstanding loans. The main conflicts are all centered on NewNet Bank and its partner online lending platform, Murray Car Finance.
Our reporter called Xinwang Bank, and a source from the institution admitted that the bank was notified, but denied that they had violated the rules and said that the rectification had been completed. The person did not comment on whether to compensate the customers who suffered losses.
New Network Bank: The words of this notification is a normal management approach taken by the regulator, mainly through criticism and suggestions, to urge banks to further optimize their services. You can see through the CBRC website that other financial institutions have also been notified, but this does not mean that their business violations. Regarding this issue of interest rate you mentioned, regarding the notification issue mentioned, our bank has basically completed the rectification. We are charging interest on the loan according to the contractual agreement. If you want to know more about Murray’s platform, you can go online and search for questions about the platform.
Mr. Chen, who is in the know, told our reporter that the new network bank with a registered capital of 3 billion yuan was formed by Liu Yonghao of China’s well-known enterprise New Hope, Cao Shiru of Chengdu Red Flag Chain, and Lei Jun of Xiaomi, all 3 of them are entrepreneurs who are highly recognized and relied on by officials, and Liu Yonghao is a high-level leader of the National Committee of the Chinese People’s Political Consultative Conference and the All-China Federation of Industry and Commerce, so the matter becomes more sensitive.
He revealed that even though everyone knows that the arrangement between Xinwang Bank and Murray Car Finance has led many customers to fall into the plight of loan sharks, still no one has openly questioned it. And NewNet Bank has not been held accountable.
Mr. Chen said: the new network of bank loans to consumer loans, he is mainly and Murray car together to engage in well, engage in car consumer loans well. Liu Yonghao is now the vice chairman of the Federation of Industry and Commerce Oh, and the vice chairman of the CPPCC seems to be, the country. My circle of friends are afraid to mention Liu Yonghao’s name. Now Cao Shiru in Sichuan fire very much. Cao Shiru is pushed for 100 years to build the party’s outstanding party members, Sichuan elected the first, ranked first oh. We have a lot of insider, now in this public opinion environment in China, we are afraid to say well. My circle of friends all want to say, spit out their black money, I do not dare to say this sentence.
The other major shareholder of New Network Bank, the secretary of the Red Flag chain surnamed Dong, said they understand that New Network Bank was informed by the CBRC, but did not respond to whether New Network Bank will assume responsibility for compensation.
Red flag chain: this requires some follow-up, our side has learned about this matter, our side also urged that the new network of banks self-examination, and then rectification. Now at the moment can only answer you like this, okay?
Mr. Zeng, who is concerned about the matter, criticized that after the outbreak of the Murray car incident, everyone is concerned about whether their usury and violent debt collection methods involve the New Hope Group and Liu Yonghao, but so far, both the CBRC and the New Hope Group have remained silent about it.
Mr. Zeng said: (Murray car) is an Internet platform well, is another share of the New Hope (Group). It is the cooperation with Xinwang Bank, it must be related. If it is a violent collection, it belongs to the police should be involved in the matter. It’s been one or two years since that incident. The company’s main goal is to provide the best possible service to its customers. The new network bank, hey, it’s still a bit dark. The rate may be as high as 30%, which is higher than the private water money (loan sharks).
Liu Yannan, founder of Murray Motors, who was arrested. (Liu Yannan’s social account picture/photo date unknown)
In recent years, some large private companies have obtained financial licenses and set foot in the banking and insurance sectors. However, certain private companies are believed to rely on the power of the powerful, or even act as white gloves for the powerful, to get a share of the pie from the officially completely monopolized financial sector.
According to the information, New Hope Group is the major shareholder of both Xinwang Bank and Murray Car Finance. Two days before the CBRC’s notification, Murray Car Finance sent an internal email to disband all its employees. As early as November 2019, the founder of Murray Car Finance, Liu Yannan, and a large number of employees were arrested on suspicion of “lending”.
In November last year, Ma’s Ant Group’s IPO fund-raising incident triggered alarms from the Chinese Communist Party authorities, and it seems that private capital’s involvement in finance has once again become an official taboo.
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