Car-hailing Driver: Rewards from Complaints

Chapter 628: Chapter 258: The Jiang Family’s Background, 30 Billion Gold Fraud

Yang Chen made a late-night phone call to personally instruct on something urgent.

Qiu Yuhong hurriedly ordered people to gather information on the Jiang Family in Jinling.

Around eleven o’clock, Qiu Yuhong compiled the information and sent it to Yang Chen.

The main investment sectors of the Jiang Family are as follows:

Public companies.

Jinling Mining, holding 52% of shares, valued at approximately 8 billion.

Zijin Mining, holding 12.5% of shares, valued at approximately 2.38 billion.

Jinling Nonferrous, holding 9.9% of shares, valued at approximately 2 billion.

Su Province Bank, holding 3.6% of shares, valued at approximately 1.8 billion.

Private companies.

Jinling City Investment, holding 4.9% of shares, the majority shareholder is the Jinling State-owned Assets Supervision and Administration Commission, valued at approximately 800 million.

Jinling Development, holding 4.9% of shares, the majority shareholder is the Jinling State-owned Assets Supervision and Administration Commission, valued at approximately 600 million.

Jinling Phoenix Gold Jewelry Co., Ltd., holding 90% of shares, valued at approximately 3 billion, the remaining 10% of shares are divided among 15 other companies and natural persons.

Jinling Treasure Hunting Group, 100% shareholding, valued at approximately 2 billion.

Jiang Holding Group, 100% control, which is the main company used by the Jiang Family for external investments.

There are about 50 other investments that vary in size, but none are large, with a combined estimated value of around 500 million.

However, an issue caught Yang Chen’s attention, which is that Jinling Phoenix Gold Ornaments has a mortgage loan of up to 30 billion, and the collateral offered to banks and financial institutions is actually 999 pure gold bullion.

Calculating based on the market price of gold, such a large loan would require around 85 tons of gold.

Dragon Country’s total gold reserves are over 1,900 tons, with annual consumption maintained at 1,000 tons and annual production at 300 tons.

A little-known private company, Jinling Phoenix Gold Ornaments, is able to provide up to 85 tons of gold as collateral for a bank loan, which is rather unusual.

Compared to Dragon Country’s gold reserves, consumption, and production, for a private gold store, 85 tons of gold is an astronomical figure.

Put it this way, considering sales scale, revenue, net profits, and other factors, if Jinling Phoenix Gold Ornaments can provide 85 tons of gold as collateral, well-known brands like Dragon Country Gold, Old Temple Gold, and Laofengxiang Gold could easily provide 300 tons of gold as collateral for the bank, which clearly indicates a problem, does it not?

Yang Chen continued reading.

Jiang Holding Group is currently launching aggressive moves against two public companies: Changhua Development and Jiuhuan Group.

Both companies are currently in reorganization, and it seems the Jiang Family wants to take the opportunity of this restructure to gain control over these two companies.

However, strategically acquiring shares in public companies requires sufficient funds.

To control these two companies, the Jiang Family would need to prepare approximately 27 billion in capital.

Jinling Phoenix Gold Ornaments used 85 tons of gold to secure a 30 billion loan from banks and other financial institutions, and the Jiang Family, holding 90% of the company’s shares, would thus gain access to about 27 billion in capital, just enough to meet the control needs for Changhua Development and Jiuhuan Group.

Yang Chen smiled slightly, having already guessed the Jiang Family’s scheme.

Once the Jiang Family gains control of Changhua Development and Jiuhuan Group, they can use these two companies’ assets to redeem back that 85 tons of gold from banks and other financial institutions.

In this way, they essentially gain control of two public companies without spending a dime.

If the Securities Regulatory Commission finds that they have misappropriated assets from these two public companies, a typical penalty would be a fine of 600,000, public censure, and an order to return the misappropriated assets.

Because the penalties from the Securities Regulatory Commission are so trivial, many controlling shareholders of public companies aren’t afraid of being punished; if there’s misappropriation, there’s misappropriation, and they engage in fraud if needed.

If the Securities Regulatory Commission doesn’t discover it, they can continue using the scheme this way, redeeming a little each year after profiting from dividends, until they can eventually compensate these two companies’ assets, thereby achieving their plan to seize opportunities without direct investment, and in this case, securing two companies. This tactic is truly clever.

This analysis clearly reveals that the purpose of mortgaging that 85 tons of gold was not just to swindle money but to gain control over those two public companies.

After securing control of these two public companies, they will then redeem that 85 tons of gold.

This brings up a very important issue: Whether that 85 tons of gold was actually given to the bank, or whether the gold is real or fake isn’t really important anymore, as long as they can redeem it in time and pay the bank the interest they’re owed.

However, judging from their 85-ton gold mortgage, it probably involves fake gold given to banks and other financial institutions; otherwise, it’s unlikely those institutions would foolishly provide them with money.

As long as that 85 tons of fake gold is exposed, the Jiang Family would commit a major crime.

A 30-billion fraud case is enough to put many members of the Jiang Family into rehabilitation.

However, Yang Chen still needs to know what the redemption conditions between the Jiang Family and the bank are.

If both parties agreed on 30 billion as the standard, as long as the Jiang Family repays the 30 billion funds and interest, they would get back the 85 tons of gold, then there would be no room for operation.

If both parties agreed to use the real-time gold price as the standard, and the Jiang Family needs to repay the money for 85 tons of gold at the current price, then Yang Chen would have room for operation.

By ensuring the gold price soars, the funds obtained from the 30 billion mortgage won’t be enough to buy back the 85 tons of gold, and then they would have to pay extra money themselves.

This means the higher the gold price rises, the more money the Jiang Family would need to pay.