According to the news report published by Xinhua News Agency on 1st February, it is reported that the Ezubao, an online financial platform was accused of acquiring fund illegally from the public and fund-raising fraud.

ANBOUND's research team is of the view that the Ezubao incident is merely one of the latest manifestations of the brutal development in China’s online finance industry; the large numbers of financial frauds is a strong proof that the country’s financial innovations are entangled with serious problems.

This has again shows our incompetency in financial regulations and the immaturity of market investors.

In order to prevent further unwarranted shocks to nation’s financial system, the regulatory departments should step up the efforts to improve the existing system and take more proactive measures to regulate private financing activities.