Jereh Company Collapses in Shenzhen: Cents on the Dollar Offered to 150,000 Gold Investors

A Shenzhen-based gold trading platform collapsed after running what was a leveraged betting operation without any real hedging, leaving more than 150,000 investors scrambling to get their money back.

Jiri’s collapse – the biggest in a recent wave of unlicensed gold rig failures across China – has now escalated into an impasse as victims rejected a payment plan that would have given them a fraction of their capital in exchange for giving up all legal rights.

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How did Jereh work?

Jeriah conducted its operations from Shuibei, the largest gold and jewelry trading center in China. The platform attracted a large number of retail investors by offering gold trades without expenses, attractive purchase rates, and a product called “Advance price trading– where users can lock in the price of one gram of gold with a deposit starting at just $4.

This system was implemented as an unlicensed options trading. The platform took the counterpart for every bet used, with leverage up to 40 times. No actual gold exchange was done. When users made profits, Jerreh had to pay the difference. When gold prices roseThese obligations became unbearable.

Running on the banks

They previously limited withdrawals around January 20, setting the daily limit at $69, or one gram of gold. Thousands of investors, many from other provinces, gathered at the company’s Shenzhen office to claim their money. Alternations with the police have been reported. Local media reported that most of the victims were housewives and working-class investors.

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Payments are far below expectations

An established local government A special task force announced On January 31, Jerreh began processing the payment after liquidating assets and raising funds. Authorities commissioned a third-party audit, and said the widely circulated figure of 13.4 billion yuan in unpaid funds was “grossly inflated.”

The victims suffered a harsh reality regarding these payments.

The platform initially offered two options: a single payment of 20% of the capital, or 40% paid in 12 monthly installments. In fact, they were paid much lower percentages than the 20% minimum.

An investor from Henan invested $5,100 and made two separate refund requests. The first returned a bid of $1,219. The second fell to $244. Another victim who had more than $44,400 in cash, 5.2 grams of gold, and 1,000 grams of silver in his account was offered just over $2,800 – equivalent to about 6% of his assets.

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Customers who purchased platinum through the platform were completely excluded from the compensation calculation, raising suspicions that Jeret did not own the precious metal.

The criminal amnesty clause arouses anger

Adding to the outrage is that Jerreh’s recovery process requires victims to sign three agreements, including a “criminal forgiveness letter” – a document that many investors say eliminates their right to pursue any additional legal action, regardless of the final payment amount.

An investor from Zhengzhou told local media that even after signing, there is no guarantee that you will actually get the money. You waive your right to file a lawsuit. For what – 1,700 yuan ($236)?

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Many refused to sign. That compares them With the platform. Several people said they are preparing an independent prosecution.

It is not an isolated case

Testify that Jeriah is not alone. Numerous similar platforms across China have been hit by cash flow crises in recent months as gold prices have plummeted, confusing operators who lacked adequate hedging mechanisms and betting against their customers.

Note that Jirih’s social accounts have been deleted. Repeated calls to the company went unanswered, and attempts to reach its owner, Zhang Zhiting, failed.

The work team in Luohu District announced that the registration of victims’ requests continues. Investigations are still ongoing.