In the latest development at the key project “Shimao Yunpu Mansion” (Shimao Cloud Realm) in the Baojiao Building in Fuzhou City, Fujian Province, a dispute over pre-sale funds has arisen, raising severe doubts from the public about the financial security net of the Baojiao Building.
According to a report from The Paper on the evening of June 24th, it was revealed that a sum of up to 130 million Chinese yuan in “Anshang Property Repurchase Funds” in the pre-sale fund supervision account of the Fuzhou Branch of China Merchants Bank was frozen by the court within less than an hour of receipt.
This fund was originally designated to pay for project construction expenses and certification taxes for homebuyers, seen as the “life-saving money” to drive the project to completion. However, despite receiving a warning letter from the Fuzhou Housing and Urban-Rural Development Bureau (Fuzhou Housing Bureau) to strengthen supervision, the Fuzhou Branch of China Merchants Bank still allowed and assisted the court in freezing this fund. Ultimately, the fund flowed into the accounts of creditors such as China Resources Shenzhen State-owned Fund Trust Co., Ltd., who had signed financing contracts with the project company.
The swift freezing of this fund highlights systemic loopholes. The bank, as the supervisory authority, failed to fulfill its obligation to freeze the funds; the court, in dealing with cases involving people’s livelihoods, did not fully implement the requirement for careful execution; and state-owned enterprises like China Resources, knowing the nature of the funds, still applied for enforcement. What is more astonishing is that despite the Fuzhou Housing Bureau previously submitting proof of outstanding taxes and pending project payments to the court, it failed to prevent the loss of funds.
This regulatory vacuum has triggered a cascade of negative effects. It is reported that over three hundred homeowners are facing difficulties in obtaining property certificates, while construction units like China Construction Third Bureau are owed over 60 million yuan in unpaid construction fees.
Following the incident, the Fuzhou Housing Bureau notified and demanded rectification from the Fuzhou Branch of China Merchants Bank in January 2025. The Housing Bureau has repeatedly informed the Intermediate People’s Court, emphasizing that “Shimao Yunpu Mansion” is part of the Baojiao Building project and that the funds involve outstanding tax payments and confirmed construction fees. Despite this, the court still went ahead with the freezing of all funds.
Blogger “My House is in a Building” analyzed in an article that this incident exposed multiple systemic loopholes, including the inadequacy of the supervising bank in freezing pre-sale funds, the court’s failure to fully implement careful execution in handling cases involving people’s livelihoods, and state-owned enterprises like China Resources applying for enforcement despite possibly knowing the nature of the funds.
The Fuzhou Housing Bureau has imposed penalties on the Fuzhou Branch of China Merchants Bank, instructing to “suspend its management of new pre-sale fund supervision related business in Fuzhou until it completes the follow-up work related to the Baojiao Building.” However, whether the frozen 130 million yuan can be recovered remains uncertain.
“My House is in a Building” pointed out that when social project funds become bargaining chips in capital disputes, the urgent need to address systemic loopholes is undeniable. Currently, a team of homeowner rights protection lawyers is actively seeking priority access to the frozen funds, while the housing system is working on establishing a three-party data sharing platform involving “court – bank – housing,” aiming to strengthen pre-sale fund supervision fundamentally. This regulatory storm triggered by 130 million yuan may prove to be a critical turning point in reconstructing the financial security net of the Baojiao Building.