10 Billion Debt Owed To Bank &Nbsp; Details Of Fraudulent Lending.

As a boss of steel trading market in Wuxi, Jiangsu, Lee fled to Australia on the eve of the Spring Festival because of the broken chain of enterprise funds, and creditors immediately filed a lawsuit against Li Guoqing.

After Li Guoqing's run, the debt of a continent group controlled by more than 1 billion, of which five hundred million or six hundred million came from banks. The company's total assets are only 150 million yuan.

At present, the Zhou Zhou group has been heavily insolvent and has applied for bankruptcy proceedings without the exact result of debt statistics. The creditors of Li Guoqing and one continents group are up to two or three hundred, and dozens of cases involved will be prosecuted in many courts in Fujian, Jiangsu, Wuxi and Shanghai.

Against the backdrop of tight money, a big business has been affecting the financing rules of the whole steel trade industry.

Detailed explanation of fraudulent loan practices

The Zhou Zhou Steel Group's steel trading market is located in Huishan District of Wuxi, which is nearly 10 kilometers away from the downtown area, because the 312 National Road backed by Shanghai to Xinjiang Huoerguosi port attracts many steel traders to settle down here.

Reporters visited a steel market in Chau, and found that only 4 of the front row 44 facades were open for business, and the number of them was 100, and there were less than 10 outlets in the whole market.

The Li Guoqing people ran away, and the value of the 23 million yuan steel in the market was frozen by the Bank of communications. Those who helped him to defrauded loans were also prosecuted by banks.

Reporters in a state steel market office building saw a notice shows that Li Guoqing and his wife Chen Yuanyuan fled the exact time in January 12th of this year, 2 days later in January 14th, the Wuxi Huishan district government intervention, temporary agencies to establish temporary management functions, to maintain market operation.

Wuxi Yizhou group was founded in November 2009. Why did it owe up to about 1000000000 yuan in just two years?

From the operation of the steel trade industry, we can have a glimpse of one or two.

General steel trade enterprises loans in two categories, one is hypothecation loans, that is, steel trade enterprises after the purchase, with iron and steel as collateral, banks in accordance with the proportion of goods to a certain amount of loans, usually in accordance with the value of goods around 70%; the other is joint guarantee, that is, banks in a better reputation than the steel trade enterprises, and several other reputable companies form alliances, mutual guarantees, in order to borrow more money, and the risk of banks is relatively small.

People familiar with the matter told reporters that Li Guoqing obtained huge financing through loopholes in the second loans.

The specific way is to set up a steel trading market to let merchants (mostly their fellow townsmen) move in. They first purchased steel products from steel mills and stored steel in Li Guoqing's own or other warehouses. In the second step, Li Guoqing further instigated these merchants to pledge loans to banks with steel and obtain mortgage loans.

In the course of operation, Li Guoqing also used warehouse supervision loopholes to amplify the scope of mortgage loans, so as to realize the leveraging of loans. Leverage is the way to get loans from the bank first and then use the same batch of steel to make loans to other banks. When the pledge information between banks is not interconnected, the result is more than one vote, and the amount of loans has been magnified to several times by multiple pledge.

In addition, the steel that Li manages is also related. Wuxi is mainly engaged in stainless steel operation. The scale of stainless steel enterprises is large, the number of well-known enterprises is relatively large, and the quantity is relatively small. Many companies engaged in carbon steel trading companies are even unfamiliar with the industry even if their assets are large, which also gave Li Guoqing a loophole.

After obtaining bank loans, Li Guoqing worked on fund trustees with a pre established Guarantee Corporation, concentrating bank loans and engaging in high risk and high return investments, such as loan sharking, real estate investment and so on.

"If we really engage in steel trade, we will not break the capital chain under normal circumstances." Liu Xin said that because of the characteristics of steel products, even if the market is not good, hasten to ship or through electronic trading, can avoid short-term risk, Li Guoqing's main problem is to invest money into other high-risk industries.

Loan hidden rules

In the steel trade enterprises, Li Guoqing is the second "absconding" case that has been publicly disclosed at present. Before this, the honorary president of the Shanghai chamber of Commerce in Jianyang, Fujian, with the background of steel trade, Huang Runming, chairman of Shanghai warm Steel Co., has been prosecuted by the court for private lending disputes. The assets of the company have been sealed up.

Although it is only one or two cases at the moment, it has a great impact on the steel trade industry.

"I want stainless steel" network researcher Zhang Jian told the newspaper that compared with other industries, liquidity is very important to steel trade enterprises, and the characteristics of steel trade enterprises are all on delivery, so even if they find customers, they can not earn money without buying money.

A related personnel of a large steel trading market in Wuxi also confirmed to reporters that private lending is very popular in the trading market. Smaller steel trading enterprises sign contracts with customers, usually borrow usury to purchase goods, even if the difference between profit and loan interest is only 1OO yuan, they will also operate.

The joint guarantee loan is a more general method in the steel trade industry. Compared with the hypothecation loan, the joint guarantee loan has a higher credit line.

People familiar with the matter told reporters that there were some steel trade enterprises in Wuxi, which grew rapidly through this mode, and invested funds from steel trade in real estate and other enterprises. Later, they had been spanformed into real estate developers or other industry traders.

After Li Guoqing's incident, banks in Jiangsu strictly scrutiny the lender, and set up the threshold for loans to the people in particular. Some banks in Shanghai have come up with some countermeasures for risk prevention and control of steel trade loans. It is understood that at least two large state-owned banks have stopped joint insurance business and private Guarantee Corporation business in Shanghai.

"Today, I have received calls from several bank friends, asking Li Guoqing case in succession." A friend who has worked in the steel trade industry for more than 10 years told reporters that banks will take this as a warning and strengthen the examination of loans issued by steel trade enterprises.

Steel trade and frost

The hottest market for steel trade enterprises was that before 2005, profits were considerable due to the impact of supply and demand. Early steel trade enterprises also rolled up like snowballs. However, with the advent of the financial crisis, steel trade enterprises in Wuxi entered the first shuffle.

At that time, the overall supply of Wuxi steel mills was greatly reduced, and other enterprises in the industrial chain could not escape. From the volume of spanactions, there were only 30-40 circulation enterprises in Wuxi's Xishan logistics park in Tongjiang.

Since last year, under the state regulation, the steel industry once again experienced survival difficulties, which lasted until the beginning of this year. At the end of 2011, the data released by the China Iron and Steel Industry Association showed that in 2011, 77 large and medium-sized steel enterprises realized a profit of 87 billion 500 million yuan, a decrease of 4 billion 200 million yuan compared with 2010, down 4.51% from the same period last year. The deficit companies expanded to 8, with a total loss of 3 billion 280 million yuan and a loss of 10.4%.

According to the survey, this year, even a large steel mill sold a ton of steel losses amounted to 128 yuan.

Weak demand for steel enterprises and low steel prices are mainly due to the state's macroeconomic regulation and control, resulting in a sharp reduction in demand for steel users such as real estate and household electrical appliances, coupled with the slowdown in exports. The supply of steel is far greater than demand in the whole country.

According to the data from "I want stainless steel", the price of stainless steel has been declining since last year. Taking the mainstream 3042B of stainless steel as an example, the price index has dropped from 138.56 in February last year to 102.37. Because the market is not optimistic about the future, stainless steel companies have reduced their positions, and their inventories are also falling.

The owner of a steel trade enterprise told reporters that the tightening of bank loans made it no longer feasible to rely on loans. In addition, steel trade enterprises also dropped from 8/1000 gross profit before 2005 to 4/1000, and the market spanparency was very high. "Plus interest on usury and staff salaries are rising, making money harder and harder."

Fortunately, in the middle of last year, he had hurriedly polished the stock, which prevented him from the inventory risk caused by falling steel prices. However, there are still some suspense about whether we can get through this year.