Recently, on the online voice social platform “BanBan” app, a lengthy post accused the public security authorities in Shunde District, Foshan, Guangdong of illegal handling of a case. It was alleged that more than 300 million yuan of funds from Wuhan Changxiangban (Wuhan) Technology Co., Ltd. (referred to as Wuhan Changxiangban Company) and its affiliated company bank accounts were transferred to the Shunde District Public Security Bureau account. This included the personal funds of company shareholders, with about 20 million yuan being deducted, leading to the suspension of the “BanBan” app.
On April 21, the official WeChat account of the “BanBan” app released a statement titled “Wuhan Changxiangban Company’s Announcement to All Employees, Hosts, and Partners on Suspension,” raising multiple questions about the actions of the Shunde police. The statement declared that “the company is unable to continue operations. BanBan app has gone through a whole year of turmoil and now has to declare a cessation of operations.”
According to the “suspension statement,” on April 17, 2023, at around 2:30 PM, the Shunde District Public Security Bureau in Foshan detained 25 personnel from Changxiangban Company on charges related to the BanBan app allegedly operating a gambling den. The financing personnel, including 8 financial staff members (of whom 1 cashier had only been working for 3 days), were detained. The public security in Shunde did not provide a list of seized items on-site, illegally seizing the company and several affiliated companies’ official seals, bank U-shields, financial documents, primary servers, and other critical business assets.
Even more egregious, the Shunde public security detained all financial department personnel at the detention center and forced them to transfer all the funds from Wuhan Changxiangban Company and affiliated company bank accounts, totaling around 300 million yuan, to the Shunde District Public Security Bureau’s account. The personal funds of company shareholders were also forcefully withdrawn, amounting to about 20 million yuan. This included the account funds of Changxiangban Company’s parent company, all subsidiaries, some cooperative companies, with the majority of the company’s funds having no relation to the gambling den investigation conducted by the Shunde public security. Even significant bank deposits were forcibly redeemed by the Shunde public security, transferring directly to the Shunde public security account, resulting in a loss of several million yuan in interest alone.
Due to the unlawful seizure of the company’s account funds by the Shunde public security, confiscation of official seals and bank U-shields, all 1600 employees’ salaries, hundreds of thousands of platform hosts, and partners’ lawful earnings were unable to be paid, leading to a situation where hundreds of thousands of people relying on the platform are left without a source of livelihood.
A former employee of Changxiangban Company, going by the pseudonym Zong Wei, told The New Yellow River reporter that they had always believed the company was operating legally and might go public in the future. Since last April, the company has come to a standstill, leading many employees to leave due to unpaid wages. Employees hope that the relevant authorities can investigate this case thoroughly and ensure that the platform settles the rightful earnings of employees and hosts.
The majority of the company’s operations are unrelated to the case. Can the uninvolved income be used to pay our wages, social security, and compensation? Another individual who attended the court hearing revealed to the reporter that although the trial had lasted several days, the questioning segment had not ended, with the next hearing tentatively scheduled for May 7.
Public information indicates that Wuhan Changxiangban Company was established in March 2018, mainly engaged in internet information services. Its primary product, the BanBan app, is a mobile software for voice live streaming, with registered users reaching 36 million and over 240,000 resident hosts.
The aforementioned “suspension statement” also listed relevant Chinese Communist Party laws and regulations to demonstrate the Shunde police’s illegal actions.
According to Article 144 of the Criminal Procedure Law, “the procuratorate and public security organs may, for the needs of investigating crimes, inquire about and freeze the savings, remittances, bonds, stocks, fund shares, and other assets of criminal suspects according to the regulations.”
Article 237 of the Public Security Organs Handling of Criminal Cases Procedure Regulations of the Chinese Communist Party Ministry of Public Affairs stipulates: “Public security organs, for the needs of investigating crimes, may inquire about, freeze or seize as provided for by regulations, the funds of criminal suspects’ savings, remittances, securities trading settlement funds, futures margin funds, debts, stocks, fund shares, and other securities, as well as equity, insurance rights, and other investment interests, and may request relevant units and individuals to cooperate. For the funds and properties stipulated in the preceding paragraphs, they shall not be transferred, withdrawn, or seized in any other way.”
In 2020, the Ministry of Public Security issued a notice “On Further Strictly Regulating Case Collaboration According to Law,” stating that “for the assets of persons involved in cases and enterprise financial accounts, only freezing measures can be taken according to the law, strictly prohibiting seizure through transfers, withdrawals, or any other means. For illegally seized account funds, public security organs shall return them through the original channels; if higher-level public security organs find lower-level public security organs illegally seized, they shall order them to return through the original channels. For assets that have been verified as case-involved according to the law, freezing measures may be taken.”
According to previous media reports, in April last year, the Shunde District Public Security Bureau of Foshan City went to the headquarters of Changxiangban Company in Donghu New Technology Development Zone, Wuhan, on the grounds that the “BanBan” app was suspected of operating a gambling den. They took away 4 executives and several financial, technical, and operational staff for investigation. Subsequently, the Shunde police criminally detained 25 personnel of the company. In November of the same year, the Shunde District Prosecutor’s Office prosecuted 7 executives and employees of Changxiangban Company, and 7 association presidents and hosts on charges of operating a gambling den.
The New Yellow River reporter learned that from April 7 to 19 this year, the case was publicly heard in the Shunde District Court for the first time, with no immediate judgment made.
During the trial, executives of Changxiangban Company stated that financial personnel transferred over 300 million yuan from the detention center to the Shunde Public Security Bureau account, leading to nearly 3 million yuan in interest losses due to the premature redemption of some significant bank deposits. Former employees of Changxiangban Company also told The New Yellow River reporter that thousands of employees were unable to safeguard their wages and social security due to the deduction of the company’s account funds.
On April 21, a person present in the courtroom during the trial informed the media that the defense counsel had requested the prosecution and the court to urge the Shunde public security authorities to return the illegally seized cash to its original account within 3 days, but the Shunde District Prosecutor’s office did not respond. Initially, the court remained reserved, but after the defense counsel repeatedly emphasized distinguishing between the involved funds and legally earned income, the judge finally stated in court that the defense counsel’s request could not be granted.
Regarding the matter of “300 million yuan of funds being deducted” from Changxiangban Company, The New Yellow River reporter made several calls to the Shunde District Public Security Bureau, Shunde District Prosecutor’s Office, and Shunde District Court on the 22nd, but had not received any effective responses by the time of publication. A staff member of the Shunde District Committee’s Political and Legal Commission said, “We will look into it first to understand the situation.”
Lawyer Fan Chen from the Beijing Jingshi Law Firm told the media that this case has not yet concluded. Only after the court resolution of the case can the funds involved be processed. The actions of the Shunde public security violate legal provisions. “The case is still under trial; it should be handled by the court (the involved funds). If there is an emergency, it also needs to be processed by the court, not the investigative agency transferring the funds to their account.” Lawyer Fan Chen also mentioned that if the public security authorities’ aforementioned actions are true, they would harm the legitimate interests of the involved company and its employees.
Zhao Sen, a partner at the Shanghai Dabang Law Firm, told Interface News that in general, the jurisdiction for criminal cases is determined by the place of the crime, including where the act occurred and the jurisdiction where the suspect resides. Without specific case information, it is difficult to judge the jurisdictional issue.