Regulator may step up action as Fanya crisis spooks investors

The securities regulator is likely to intensify its crackdown on unregulated equity and commodities exchanges, after a 40 billion yuan ($6.25 billion) asset default at a rare metals exchange triggered widespread protests from investors.

On Monday, hundreds of investors from across the country gathered outside the office building of the China Securities Regulatory Commission, demanding return of the money that they had invested in high-interest rate financial products sold by the Fanya Metal Exchange located in the southwestern city of Kunming in Yunnan province.

The exchange has ceased to pay back investors' funds and investment proceeds from its financial products that promised an annual return as high as 13.6 percent. It is estimated that the Fanya scandal may involve more than 200,000 investors nationwide with total investment value exceeding 40 billion yuan.