Fanya is short for the Yunnan Kunming Fanya Non-ferrous Metal Exchange.

It is the first exchange platform for non-ferrous metal in China, and began trading on April 21, 2011 with a registered capital of 100 million yuan. The firm was originally based in Kunming, the capital city of Yunnan Province, but quickly fanned out across China, operating in 28 provinces and drawing funds from more than 220,000 investors, who bought "financial and money management" products offered by trusted state banks.

While Fanya had government approval to oversee trade in metals,

it was never given permission to engage in its so-called "rijinbao" financing scheme - selling products to retail investors which allowed them to lend money to metal traders and promisng them annual returns of up to 14 percent. Analysts in China have referred to the practice as a form of Ponzi Scheme.

In total, some 240,000, victims of Fanya's metal trade scheme,

mostly average Chinese people, lost some 43 billion yuan ($6.54 billion). The investors could not withdraw money from "finance and money management account" from April 2015, and from July 2015, funds deposited into Fanya by investors were frozen.

The whole case is still under investigation

while 19 people, including Fanya boss Shan Jiuliang, have been arrested for fraud. Repeated protests across China by disgruntled investors, who have utilized social media to organize events and circulate petitions, have not stopped since the scheme was exposed.

The first signs of trouble

Signs that China’s Yunnan Kunming Fanya Nonferrous Metal Exchange was headed for trouble initially appeared in early 2015 - at which point, it was too late. Read More

The Investigation

On Feb. 5, authorities in southwestern China’s Yunnan province announced that an investigation had uncovered criminal activities by the Kunming Fanya Metal Exchange. Read More

Government Responsibility

China’s government has a “moral responsibility” to victims of a scam that bilked some 240,000 people out of their investments. Read More

Repercussions of the Scandal

The Tip of the Iceberg

An investigation that uncovered the Fanya incident is just the “tip of the iceberg” and will likely lead to the discovery of many similar scams amid poor government oversight in the country. Read More


The lion’s share of investors’ money lost amid a default by the Kunming Fanya Metal Exchange in southwestern China’s Yunnan province is unrecoverable. Read More

China's Stock Bubble

The bursting of China’s stock bubble in 2015 and a lack of regulation in the private lending and P2P sectors has caused potential investors to shy away from those markets. Read More

Reforms Needed

Investment scandals such as Fanya incident suggest that the country’s economy will stagnate without measureable political reform. Read More

Selective Investigation

Authorities in China were quicker to investigate fraud involving the Ezubao online investment scheme than illegal activities by Kunming Fanya Metal Exchange because the latter was closely tied to local government. Read More

Reported by Radio Free Asia

And RFA's Mandarin Service.