Facts

The investigation alleged that Z had absorbed more than RMB 30 million from depositors in a disguised form, offering a written commitment of a 12 per cent annual return, and that the conduct constituted the illegal absorption of public deposits. The file was transferred to the procuratorate and then to court.

Issues

Whether the funds were raised from the public at large (the element that distinguishes this offence from lawful private lending); whether Z was the organiser or an intermediary; and the extent to which repaid principal and interest reduce the assessed loss and therefore the sentence.

Defence

Li Xiaohua acted for Z. The defence separated the amounts actually received from those rolled over, documented repayments, identified investors who were relatives and long-standing contacts rather than members of the public, and emphasised cooperation and asset recovery.

Outcome

The court convicted Z and, having regard to the restitution and the mitigated circumstances, imposed a sentence at the lower end of the applicable range.