Recently, Chinese media exposed an engineering scam. A businessman from Zhejiang was deceived after taking on a “migrant community” project in Shanxi. Investigations revealed that the government documents used to gain his trust were forged, and the so-called special funds were fictitious. The businessman claimed to have invested nearly 29 million yuan and now finds himself in a debt crisis.
According to a report by the Chinese media outlet “Red Star News,” Ms. Lei, a businesswoman from Lishui, Zhejiang, stated that in 2022, she was introduced to the “Liangdu Dongshan Migrant Community” project in Lingshi County, Shanxi, through a subsidiary of a state-owned enterprise, where she was required to provide funding for the construction.
Before taking on the project, Lei said that the other party had shown her documents stamped with the government seal and promised special funding support for the project. They assured her that at least 30% of the construction costs could be settled within the year. Her team was even taken to a local bank to verify the funds, where they were informed that there was over 80 million yuan in the account, leading her to decide to invest in the construction.
However, after the construction started, the promised payments did not materialize, resulting in multiple work stoppages and restarts. Upon verification, Lei discovered that the government “red head documents” used to earn her trust were forged, and the so-called special fund account did not exist.
Investigations revealed that the initial contractor for the “Liangdu Dongshan Migrant Community” project was Jinzhong Zhenghe Real Estate, but after the initial completion of two buildings, the project was abandoned. Subsequently, the project was transferred to Ren, the village secretary of Liangdu Village, who subcontracted it to a certain subsidiary, who in turn subcontracted it to Lei. During this process, new agreements were signed with Ren, but it was revealed that the signatures were forged by Ren’s driver, and the government “red head documents” were forged by Wei, the person in charge of the subsidiary.
In September 2025, Wei was sentenced to six months in prison and fined 2,000 yuan for forging state agency documents in a case heard by the Xiaodian District Court in Taiyuan City.
According to the verdict obtained by a reporter from “Red Star News,” Wei admitted to using technical means to forge government documents to pass the company’s risk control review and claimed that he, too, was a victim of deception.
Wei revealed, “Ren told me that this project was for resettlement homes and there would be special funds later. He even showed me the list of resettlement households.” Based on this information, he decided to take on the project. In order to pass the company’s risk control evaluation, he chose to forge documents.
Wei also acknowledged that in August 2022, he took Lei’s employees to the Liangdu branch of the Lingshi Rural Commercial Bank in Shanxi, where the bank staff verbally confirmed that there was over 80 million yuan in the account they were shown. Wei said that he had also invested a substantial amount of money in the project, with around 8 million yuan still being sought.
Regarding the authenticity of the project, Lei mentioned that the town government did issue a genuine letter stating that the project was for the construction of a migrant community in their town, which led her to continue investing. She insisted that the town government should take responsibility.
However, the local government responded by stating that while they had issued a document agreeing to the project initiation, it did not involve special funds. They noted that any responsibility determination and fund disputes related to the project would need to be resolved through legal means.
When asked whether Ren, as the village secretary, should bear any responsibility in this matter, the town mayor stated, “As the village secretary, we have a supervisory responsibility over him. However, regarding economic disputes involving him as an individual and other independent civil entities, we cannot intervene.”
Lei informed reporters that the incident involved a mix of forged government documents, fictitious special funds, bank cooperation in verifying funds, and was not a simple contract dispute from the start.
Lei revealed that she had already invested nearly 29 million yuan, as all the materials for the rush construction were purchased with her own funds. With the investment not being recovered, she is unable to pay downstream debts and is facing multiple lawsuits.
On April 9, reporters from “Red Star News” visited the project site and found the gates closed with no construction ongoing. The interior was overgrown with weeds, unfinished unit buildings were filled with scattered construction debris, and the project site was in a state of disrepair and abandonment.