Investors repaid in Huaxia scandal

Investors who purchased fraudulent wealth management products from China’s Huaxia Bank said they were compensated their principal investment sum without interest, Caixin reported. The payout showed a reinforced commitment to protecting investors from risky investment products. Eighty investors bought the products between late 2011 and mid-2012 from the bank’s client manager, but were later informed that their contracted yield would not be paid as a result of fraud. Huaxia refused to compensate the investors claiming that the sales were unauthorized. The investors made an agreement with the company guaranteeing the returns, Zhongfa Investment Guarantee, on a sum to cover principal but not interest. Zhongfa had initially refused to compensate investors, citing ongoing police investigations into the fraud. Investors received the refund checks from the bank on January 14, but it was unclear who made the payment. Huaxia declined to comment and Zhongfa did not respond to an interview request.