Tuesday , May 28 2024

Chinese arrested for running usury ring charging 2,000 pct yearly interest rate

A Chinese man and six others were arrested on charges of usury, Hanoi police said Thursday.

The Chinese mastermind Zhang Min, 36, Nguyen Quang Vu, 35, along with five others, are being investigated for “usury in civil transactions.” They were involved in a transnational usury ring that was busted two days prior, across seven locations in Hanoi and the northern provinces of Vinh Phuc and Thai Nguyen.

Vu would operate the ring while Min was personally in charge of the debt collecting side of the group.

The group founded a pawn shop and built three apps: cashvn, vaynhanhpro and ovay. The ones with educational backgrounds would work in accounting, human resources and market development, while members with criminal and shady backgrounds would work as debt collectors.

Their preferred clients were those with stable jobs and clear phone directories. One only needs to send the group a photo of their personal ID and their phone directory as collateral through the app to borrow up to VND30 million ($1,293) without ever meeting or signing any document.

Borrowers would need to pay back their loans within three-five days, and should they fail, would have their interests rocket to 2,000 percent a year. Some managed to pay their debts, while others fell further into the trap.

There are around a million users of the ring’s three apps. Each month, the group lent around VND100 billion to its clients.

Commercial banks in Vietnam typically charge a yearly interest rate of up to 25 percent.

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