Ning Ding, chairman of Yucheng Group which launched peer-to-peer (P2P) lender Ezubao in July 2014, was among 21 people arrested by Chinese authorities in early 2016.
A Beijing court sentenced Ding to life in prison and fined him CNY100m for crimes including illegal fundraising, illegal gun possession and smuggling precious metals, reports newswire Reuters.
He collected a monthly salary of CNY1m and previously admitted on state television to spending around CNY1.5bn of Ezubao’s funds on himself.
His brother Dian Ding was also handed a life term, with 24 others hit with sentences ranging from three to 15 years, according to an article on the court’s social media account.
Rise from obscurity
Over an 18-month period, the finance platform rose from obscurity to become one of the most dominant companies in the industry.
Investors were offered returns far exceeding market norms, with expected annual yields on Ezubao’s six products between 9-14.6%.
However, more than 95% of the projects allegedly financed by the scheme were found to be fake.
The firm was shut down on 8 December 2015 after police raided offices in several cities and detained executives, including Ning Ding.
Operations were spread across 31 provinces, with police using two excavators in the eastern Anhui Province to dig for around 20 hours. They were able to recover 80 bags of evidence that had been buried at a depth of six meters.
Around 1,200 account books were uncovered.
Following the Ezubao collapse, policymakers imposed limits on peer-to-peer lending and stopped platforms from taking public deposits or selling wealth management products, reposts newswire Bloomberg.
