Shenzhen Issues Warning on Illegal Financial Intermediaries and Loan Scams

Shenzhen’s local financial regulatory authority issued a risk alert warning consumers about illegal intermediaries in the financial sector.

According to Jin10, the Shenzhen Municipal Financial Management Bureau said that in recent years some organizations and individuals have claimed to provide intermediary services or design financing plans, using slogans such as “fast approval,” “higher limits and lower rates,” and “debt optimization” to lure consumers into obtaining loans from financial institutions or negotiating repayments through illegal means. The bureau said these practices seriously harm the legitimate rights of financial consumers and disrupt financial market order.

The bureau said some illegal intermediaries promote claims such as “loans don’t need to be repaid,” “monetizing credit records,” and “earning a million while doing nothing.” It said these groups actually fabricate occupations, income, and transaction records to package consumers’ identities,诱骗 them into becoming so-called “professional debt bearers.” The bureau said the intermediaries then obtain loans from financial institutions, disappear, and shift the resulting debts and risks onto consumers.

The bureau also warned that some intermediaries use pitches such as “refinancing to cut interest,” “boosting credit limits,” and “big reductions in monthly payments” to诱导 consumers to use high-interest bridge funds and roll over debt by borrowing new loans to repay old ones. It said these practices can involve improperly replacing housing mortgage loans with lower-interest inclusive finance business loans.