Major Chinese insurer PICC Property and Casualty Co. and several smaller insurers are reportedly involved in a controversial set of loans worth RMB20 billion (US$2.8 billion), after it was found that at least some of the gold bars used as collateral were fake.
Wuhan Kingold Jewelry Inc. was able to loan the amount over the past five years using collateral of 83 tons of gold bars and RMB30 billion (US$4.2 billion) in property insurance policies issued by the insurers, according to a report by Caixin. Nasdaq-listed Kingold is led by former military man Jia Zhihong, who is the company’s chairman and controlling shareholder.
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