In Shandong Linyi, a 60 million yuan (RMB, same below) non-performing asset debt was abruptly lowered to 40 million yuan before the auction, and it was quickly snapped up by a suspected shell company that had only been established for two months. The actual controller of the company, Sun Dezhen, was revealed to be the wife of local court official Zhang Qinglin, sparking external doubts.
According to mainland media “The Paper,” on March 22, 2021, Linyi Hedong Rural Commercial Bank auctioned off a 60 million yuan non-performing asset debt. During the auction on the Zhongpai platform, 8 minutes before the start, the starting price was lowered to 40 million yuan. The transaction was completed in less than 3 minutes, and the company that acquired the debt had just been established for over two months.
The guarantor of the debt, Hao Yanping, stated that the platform delayed the auction, which was originally scheduled for 10 a.m., without prior notice. The auction started around 1 p.m., and the starting price was suddenly reduced by 20 million yuan.
Hao claimed that the sole bidder who acquired the debt – Shandong Longrun Holdings Group, which had only been established for just over two months at that time, had Sun Dezhen as the actual controller, who is the spouse of Zhang Qinglin, the head of the technical office of the Hedong District People’s Court in Linyi. The Hedong District Court is also related to the case behind this debt.
Longrun Holdings Group had a registered capital of 0 yuan and no actual operating records, leading to suspicions of being a shell company.
A staff member of Longrun Company confirmed that Sun Dezhen is still the person in charge of the company, while the current legal representative, Liu Zongwei, “just goes to work,” and specific details need to be obtained from Sun Dezhen. However, Sun Dezhen did not answer the reporter’s calls.
The Linyi Hedong District Court confirmed to mainland media that Zhang Qinglin is currently the head of the technical office of the court. In relation to the involvement of his family members in the auction of bank debt, a court employee stated that they are “aware of the matter.”
In response to this, Zhang Qinglin stated that he has never been involved in his wife Sun Dezhen’s business dealings and was unaware of them. Regarding Sun Dezhen’s purchase of the 60 million yuan bank debt, he mentioned that it was a public online auction where anyone could participate.
Lawyer Zhang Dezhi from the Beijing Legal Aircraft Law Firm remarked that in the auction notice, the subject of the debt was stated as 60 million yuan, and the initial starting price was also 60 million yuan. This kind of situation is rare, as debt assets usually come with high risks, making few people dare to bid. Those who do not understand the situation may directly be discouraged by the announcement. Also, system messages showed that the auction did not start at 10 a.m., but at 13:02:47. According to regulations, any changes to the auction time should require a reannouncement and a second auction; otherwise, it can easily raise suspicions of directed bidding.
In response to this, mainland netizens also expressed skepticism: “Wife does a 40 million business without her husband’s knowledge. How strong must their financial power be for this, even Jack Ma wouldn’t dare say that.” “It’s a company registered specifically for the auction.” “The key point is, isn’t the timeframe too short for this? Usually, these debt auctions involve collusion and profit-sharing?” “Any unit could pick one and win an Oscar.”
Currently, local authorities claim to be conducting a joint investigation into the matter.