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19

Chinese Investment Scandal Highlights ‘Shadow Banking’ Risks

By Tony Seruga

A China Minsheng branch in Beijing. Poorly regulated financial products are often missold to Chinese investors hungry for returns that handily beat what banks offer for deposits. CreditJason Lee/Reuters

BEIJING — When Lisa Wang sank her retirement money — all $730,000 of it — into a single investment, her fund manager repeatedly said the product was risk free.

It wasn’t.

On Wednesday, Ms. Wang, 61, joined about a dozen other customers in the lobby of a Beijing branch of the bank China Minsheng, pressing employees for details and demanding their money back, after the Chinese news media reported that more than $400 million of investors’ money had disappeared…

Chinese Investment Scandal Highlights ‘Shadow Banking’ Risks

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