[Direct answer]In the Beijing area, it is necessary to first distinguish whether the disputes involve the sale of regular financial products or illegal fund-raising and fraud under the guise of financial management. If the funds are raised from the public under the guise of financial management, it may constitute illegal fund-raising. According to Article 2 and Article 25 of the "Regulations on Prevention and Handling of Illegal Fund-raising" (State Council Decree No. 737, implemented on May 1, 2021), the lead department for handling illegal fund-raising shall organize the investigation and handling of the case. The losses suffered from participating in illegal fund-raising shall be borne by the participants themselves. Those suspected of crimes shall be promptly reported to the public security organ for investigation and prosecution in accordance with Articles 176 and 192 of the "Criminal Law of the People's Republic of China" (amended on December 26, 2020 and implemented on March 1, 2021) for the crimes of illegally absorbing public deposits and fund-raising fraud. If it involves the illegal sale of regular financial products, the parties may claim the rescission of the contract and the return of the property in accordance with Articles 148 and 157 of the "Civil Code of the People's Republic of China" (implemented on January 1, 2021), and require the issuers and sellers to bear compensation responsibilities in accordance with Article 73 of the "Minutes of the National Court's Civil and Commercial Trial Work Conference" (issued on November 8, 2019).

1. Problem background and typical scenarios

False financial management cases baited by high returns occur from time to time. Typical scenarios include: funds cannot be redeemed after being raised under the guise of private equity funds, precious metals, pension projects, etc.; sales staff privately promoting products not belonging to their own bank, i.e., so-called unauthorized sales; selling fake products under the guise of banks; fabricating underlying assets and profit levels; and the responsible person going missing after the capital chain breaks down. When handling such cases in Beijing, the authorities will first determine whether they constitute illegal fund-raising and monitor the progress of criminal proceedings, while also examining whether the sales agencies are at fault and should bear compensation responsibilities.

II. Key points of dispute

Firstly, whether it belongs to a financial dispute or a criminal case of illegal fund-raising. Secondly, the rules for recovering funds and bearing losses. Thirdly, whether the sales agency bears responsibility and the form of responsibility. Fourthly, whether investors can claim to revoke or terminate the contract. Fifthly, the connection and choice of cross-procedures between criminal and civil cases. Sixthly, the preparation of evidence and materials for reporting the case to the police.

III. Professional analysis by Henglue Lawyers

Based on Henglue Lawyer's practical experience in handling cross-disciplinary cases involving finance and criminal law, such issues typically revolve around three key points. First, nature identification: Whether the activity involves public promotion, profit promises, or fundraising from unspecified individuals is crucial in distinguishing illegal fundraising from ordinary disputes. In cases of illegal fundraising, losses are generally borne by the fundraising participants themselves, while recovering funds and seeking compensation can help mitigate some of the losses. Second, accountability: If financial institutions or their employees commit violations, such as unauthorized sales, failure to fulfill suitability obligations, or negligence in personnel management, investors may demand compensation from the issuers or sellers in accordance with Article 73 of the "Memorandum on Civil and Commercial Trial Work of the National Court". The institutions cannot entirely evade liability by blaming the employees' individual actions. Third, procedural selection: Criminal reporting can assist in recovering funds, while civil litigation can assert the institutions' liability. The two approaches can be combined. Investors should retain contracts, transfer records, promotional materials, and communication records, cooperate with investigations, and assert their rights in a timely manner.

IV. Practical suggestions and legal basis

Action list: First, immediately organize contracts, transfer records, promotional materials, and chat records; Second, report the case to the public security organ and provide complete materials; Third, report the illegal sales behavior to the financial regulatory department; Fourth, verify the flow of funds and the recipients; Fifth, assess whether the sales agency is at fault and claim compensation; Sixth, monitor the progress of the criminal case and the recovery and repayment of funds, and initiate civil litigation if necessary. For matters involving financial consumer rights and investment disputes, you may refer to the relevant provisions.\nFinancial capital and cross-border transactions involving foreign entities; For cases involving the intersection of criminal and civil law and the investigation of responsibilities, they can be combined together.Criminal defenseColumn; for reference, it involves the recovery and enforcement of fundsCreditor's rights and debts, and enforcementFor disputes involving sales contracts, the parties may resolve them through negotiation or arbitration.Business and contract disputes in enterprisesLegal basis: Article 2 and Article 25 of the "Regulations on Prevention and Handling of Illegal Fund-raising" (effective May 1, 2021); Articles 176 and 192 of the "Criminal Law of the People's Republic of China" (effective March 1, 2021); Articles 148 and 157 of the "Civil Code of the People's Republic of China" (effective January 1, 2021); Article 73 of the "Memorandum on Civil and Commercial Trial Work of the National Courts" (effective November 8, 2019). The specific application shall be subject to the currently effective laws, regulations, and judicial rulings.

5. Henglu Law Firm's Reminder

Firstly, when dealing with fraudulent financial management, it is necessary to identify its nature. Whether it constitutes illegal fund-raising directly affects the path of recovering the funds. Secondly, reporting the case to the police and initiating civil litigation can proceed in parallel. The former helps to recover the funds, while the latter can hold the institutions accountable. Thirdly, if the sales agencies are at fault, they can be required to bear compensation liability through evidence. Fourthly, in principle, the losses of the fund-raising participants should be borne by themselves. The earlier the case is reported, the more favorable it will be for recovering the funds. If you are currently facing similar problems, you can seek assistance through the following channels:\nFinancial capital and cross-border transactions involving foreign entitiesThe service provides a comprehensive solution, and those involving criminal accountability can be integrated into it.Criminal defenseFor plates involving the recovery of funds, you can refer to the following for more information.Creditor's rights and debts, and enforcement.

VI. Frequently Asked Questions

Q1: Can I get my money back if I buy fake financial products?

It depends on the nature and the approach to recovery. If it is illegal fundraising, according to Article 25 of the Regulations on Prevention and Handling of Illegal Fundraising, the losses suffered from participating in illegal fundraising shall be borne by the fundraising participants themselves, but some of the losses can be recovered through the recovery of the funds and compensation; if it is an illegal sale by a regular institution or there are faults, investors can claim to rescind the contract, return the property, and pursue the institution's compensation liability in accordance with the Civil Code of the People's Republic of China and the Jiushiminjiu (Nine Civil Cases).

Q2: Should I call the police or file a lawsuit directly?

It is recommended to first report the case to the police and simultaneously evaluate civil litigation. For cases involving suspected illegal absorption of public deposits and fund-raising fraud, the victim should promptly report the case to the public security organ and provide complete materials; if the sales institution is at fault, the victim can also consider seeking civil compensation from it. Criminal and civil procedures can be conducted in conjunction with each other. The specific approach should be determined based on the nature of the case and the evidence situation, with the assistance of professional lawyers.

Q3: If a bank employee secretly sells fake wealth management products, does the bank need to compensate the customers?

They may bear liability for compensation. If financial institutions commit faults in personnel management, branch management, or product sales, investors may, in accordance with Article 73 of the "Memorandum of the National Court's Civil and Commercial Trial Work Conference", require the sellers to bear liability for compensation, and the institutions cannot completely exempt themselves from liability solely on the grounds of the employees' personal actions. Whether to bear liability and the proportion of liability shall be determined based on the specific faults and evidence identification.

Q4: What materials do I need to prepare when reporting a case?

These usually include investment contracts or agreements, transfer and receipt vouchers, promotional materials and profit promises, chat logs and call records with sales staff, bank transaction records, information about the other party, and identity documents of the participants. The more complete the materials are, the easier it will be for the public security organ to clarify the facts and recover the funds involved in the case, and it will also help with subsequent accountability.

Q5: How will the recovered money be distributed?

Generally, the case is handled in accordance with legal procedures. After the funds involved in the case are investigated and recovered by judicial authorities, they are usually returned to the investors in accordance with the effective legal documents and disposal plans. The insufficient portion is distributed proportionally. The distribution is limited to the actual recovered funds, which may not be able to fully compensate for the losses. Therefore, it is very important to report the case in time and cooperate with the investigation to recover the losses.

The above answer is based on the judicial practice in Beijing. The judicial interpretations in other provinces and cities may vary. For specific cases, please refer to the local rules and evidence situation.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, to avoid missing the statutory time limit. →Financial capital legal services·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and open adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. If you encounter disputes, please consult a practicing lawyer in time.