China to ramp up crackdown on illegal fundraising

SHANGHAI (Reuters) - China said on Monday it will closely monitor interest rates charged by private lenders, securities companies and futures firms to crack down on illegal fundraising.

China has been dogged by a series of high-profile financial scams in recent years which often end up harming members of the public, some of whom have invested their life savings.

While incidents of illegal fundraising in China are decreasing, the situation remains severe, according to a release issued jointly by several regulators at a Beijing news conference.

China’s supreme court said illegal fundraising severely damages market order and national financial security, according to the release.

The People’s Bank of China (PBOC) said it will continue to fend off risks from internet financing, adding that all platforms offering initial coin offering (ICOs) and bitcoin exchanges have been safely closed down.

Financing intermediaries, online finance platforms, real estate and agriculture are all major areas of illegal fundraising, the statement said.

Illegal fundraising often finds its way into real estate speculation in China, pushing housing prices higher.

The housing ministry said it will improve its monitoring of the property market and increase a crackdown on illegal activities by real estate developers and intermediaries.

Reporting by Shu Zhang in Beijing and Engen Tham in Shanghai; Editing by Kim Coghill