A gold-futures trading ring in China's central province of Henan has fleeced more than 5,000 investors of over RMB380 billion ($58.62 billion).
The China Daily reports that police have arrested 33 individuals for participation in the illegal gold-futures trading scheme which involved Loco London Gold.
The ring is believed to have commenced trading in October 2008 despite never registering with local industrial and commercial authorities.
Although the ring was active in the central province of Henan, suspects involved in the case opened their bank accounts in Shanghai's Pudong New Area, and a number of suspects were apprehended in the affluent coastal city.
Adrian Day of Adrian Day Asset Management observes in Forbes that the scandal could compel members of China's burgeoning middle class with a penchant for the precious metal to invest in physical gold instead of paper contracts.