A financial scandal has rocked China’s Guangdong province after JYS Group, an investment firm promising high returns through speculative ventures including crypto trading, collapsed in April 2025. The firm is estimated to have raised ¥1.34 billion (roughly $180 million) from retail investors before its chairman, Lin Chunhao, fled the country.
In a WeChat message sent to investors and employees, Lin confirmed he had left China and was already on “British soil.” He claimed to have personally lost over $96 million and blamed the company’s collapse on failed investments and mounting operating expenses.
Promises of High Yields, Delivered Through Hype and Deception
JYS Group attracted thousands of middle-class investors through financial literacy seminars and word-of-mouth referrals. Its products, advertised as “safe” and “high-return,” offered annualized returns between 6% and 9%, with investment periods ranging from three months to three years.
Operations were linked to Shenzhen Haiboxin Project Management, a firm falsely claiming connections to Chinese state-owned enterprises. Investigations have since revealed that Haiboxin shared offices and staff with JYS Group, undermining any claims of separation.
Crypto Losses and Fake Projects
Though investors were told their money supported infrastructure projects like roadworks and tunnels, Lin’s final message revealed a different story: the funds were lost through peer-to-peer lending, failed crypto trades, stock speculation, and unpaid promissory notes. In total, nearly $30 million was lost in these three categories alone.
Lin did not provide evidence of any real-world projects or assets backing the firm’s promises. By the time investors demanded answers, many of the agents who had sold the products were unreachable.
Authorities Launch Criminal Investigation
Local police have shut down JYS offices in Shenzhen and Zhongshan. A full criminal investigation is now underway, led by the Shenzhen Public Security Bureau’s Economic Crime Unit.
Regulators believe the firm operated in a legal gray area—posing as a “project management” or education company to sidestep financial oversight. The collapse has reignited concerns over the light regulation of crypto-linked products marketed to everyday investors.
What Comes Next?
- Extradition Efforts: Lin’s presence in the UK complicates recovery efforts, as no active extradition treaty exists between China and the UK for white-collar financial crimes.
- Investor Impact: Thousands are likely facing total losses. Legal claims may be filed domestically, but asset recovery will be difficult without international cooperation.
- Regulatory Pressure: The incident may push Chinese regulators to tighten rules around quasi-financial firms and crack down on crypto-influenced investment scams.
FAQs
Q: Can retail investors get their money back?
A: It’s unlikely unless Chinese authorities can seize assets or negotiate cross-border recovery with the UK.
Q: What warning signs were missed?
A: High guaranteed returns, vague project descriptions, and reliance on personal networks are all classic red flags.
Q: Will China regulate crypto harder after this?
A: This incident will likely strengthen the Chinese government’s case for stricter oversight of firms even loosely associated with crypto.
