The first hearing of the Haiyin Group's fund pool collapse case, involving over 70 billion yuan, took place in Shanghai on September 1, 2026, following a police investigation, marking a significant development in a scandal that once shook the financial sector.

Han Hongwei and his son Han Xiao, who once secured a spot on the Hurun Rich List with a net worth of 6 billion yuan and were dubbed the wealthiest family in Yongcheng, now face criminal proceedings. During the trial, both repeatedly claimed to be unaware of the intricate details of the charges against them.

The case, filed under the charge of fund-raising fraud, includes not only the Han family duo but also entities such as Wuniu Holding Co., Ltd. and Haiyin Holding Group Co., Ltd. Given the broad scope of those affected, the court arranged multiple video-link rooms alongside the main courtroom to accommodate the large number of victims.

According to reports, around 200 attendees gathered in the video-link rooms, many having traveled from provinces such as Jiangsu and Henan to witness the proceedings firsthand.

Regarding asset recovery, police have reportedly frozen over 300 domestic and overseas bank accounts, seized assets valued at 1.5 billion yuan, and recovered funds and equity stakes totaling 1.82 billion yuan from the United States and Thailand. Further details of the case, including how shell companies, filing materials, and underlying assets were layered within the fund chain, are expected to surface as the trial unfolds.

Haiyin Wealth Faces Fraud Charges as Executives Plead Ignorance

The collapse began in December 2023 when Haiyin Wealth abruptly halted redemptions on its financial products, shattering what had been a long-standing facade of prosperity. By September 11, 2024, Shanghai's Fengxian District police had launched a formal investigation into Haiyin Wealth for suspected illegal fundraising, imposing criminal coercive measures on key figures including Han Hongwei, Han Xiao, and Wang Dian.

Spanning nearly three years from the initial collapse to the court date, the case has escalated from allegations of illegal fundraising to the more severe charge of fund-raising fraud. In contrast, the Zhongzhi Group, implicated in a similar scandal, was convicted of illegally absorbing public deposits in its first-instance ruling in December 2025.

Lawyers point out that although both charges fall under the umbrella of illegal fundraising crimes, the fundamental distinction lies in the intent of the perpetrators. The crime of illegally absorbing public deposits primarily harms national financial regulation, focusing on the unauthorized collection of funds from the public, whereas fund-raising fraud also requires proof of intent to unlawfully appropriate the funds and the use of deceptive methods to raise capital.

Judicial interpretations from China's Supreme People's Court have explicitly established the intent to misappropriate as a key benchmark for distinguishing between the two offenses. Legal experts suggest that the prosecution's decision to charge Haiyin with fraud indicates a belief that the group's actions went beyond mere regulatory violations, potentially involving fabricated projects, concealed uses of funds, and failure to allocate raised capital to stated underlying assets as promised.

Investigations have revealed that Haiyin Wealth facilitated the issuance of 465 wealth management products through 22 unlicensed exchanges, amassing a total of 71.69 billion yuan. These products were backed by underlying assets belonging to a sprawling network of shell companies. However, compared with the amounts raised, these underlying assets were often severely undervalued, with many wholly fabricated, and a significant portion of the funds remains unaccounted for.

Legal professionals note that the fabrication of underlying assets, the substantial unaccounted funds, and the transfer of assets overseas have led judicial authorities to conclude that the group acted with intent to unlawfully appropriate investor funds. In contrast, executives from Zhongzhi Group's subsidiaries were mostly convicted of illegal absorption of public deposits, while Haiyin's more thorough falsification and stronger evidence of fund interception warranted an upgraded charge.

This distinction carries profound implications for investors. The fraud charge triggers more coercive asset recovery procedures but also means that expectations of principal return depend more on the actual recovery of assets rather than the platform's ability to repay.

At the hearing, prosecutors alleged that the Haiyin Group accumulated over 310 billion yuan in total fundraising, with approximately 65 billion yuan left unredeemed. One investor noted, however, that since many participants had reinvested earnings, the actual principal injected might be lower, often estimated at a 20-30% discount.

Attendees who followed the full proceedings revealed that the initial hearing focused primarily on statements from the Han father and son, along with their defense attorneys. When questioned about specific details of the fraud, both claimed ignorance.

A second core criminal trial within the Haiyin system is scheduled for September 3, involving Haiyin Wealth Management Co., Ltd., Wang Dian, and Heisheng Holding Co., Ltd., also under the charge of fund-raising fraud. Public records indicate that Wang Dian is the sister of Wang Pei, Han Hongwei's wife.

As these two trials progress, questions remain about the ultimate destination of the 71.69 billion yuan raised and who was responsible for approving the fabricated underlying assets. The answers are expected to emerge as the courtroom proceedings continue.

The Mechanism Behind Haiyin Wealth's Layered Fund Pool

Previous investigative reports spanning over two months and covering eight provinces have shed light on Haiyin Wealth's operational model. Among the 22 issuers, 49 fundraising accounts were established to receive investor payments, with an average of over nine products sharing a single account. One issuer managed to launch 84 products using just three accounts, with funds from dozens of products commingled, creating a pool.

Based on product names, nearly all of Haiyin's offerings were structured as debt projects, with funds intended for lending purposes and underlying assets described as accounts receivable or similar debt instruments.

Issuers ranked by fundraising scale included Shanghai Haiyi Asset Management Co., Ltd., with 10.47 billion yuan raised across 55 products, Shanghai Luoyi Industrial Co., Ltd., with 7.04 billion yuan across 33 products, and Yijia Supply Chain Management Co., Ltd., with 6.82 billion yuan across 84 products. Most other issuers also raised more than 1 billion yuan.

Notably, funds collected by these issuers did not flow directly into underlying projects linked to investors. Instead, they were transferred to accounts held by 13 special purpose vehicles, adding a second layer of concealment. For instance, funds from three issuers entered Shenzhen Jiunuo Commercial Factoring, while nine accounts from six issuers funneled money into Shenzhen Hongrende Asset Management. After two rounds of aggregation, the funds lost all identifying traces.

These issuers and SPVs had no direct equity ties to Haiyin Wealth, and while they appeared to be selling third-party products, they were essentially shadow shell companies under Han Hongwei's control.

The absence of legitimate registrations was a pivotal factor in enabling the scheme. The 465 wealth management products were backed by filings from 15 institutions, most of which had been targeted for cleanup or had their licenses revoked or business scopes altered by regulators. These unlicensed exchanges, often labeled as asset registration services, operated outside the bounds of lawful financial licensing.

Regulatory authorities had already initiated efforts to dismantle such illegal exchanges by the end of 2021, stating that their activities constituted illegal financial conduct warranting strict prohibition. Despite these actions, Haiyin Wealth persisted in using these unlicensed entities to complete its product filings, providing a veneer of compliance that fundamentally misled investors.

The Fall of a Former Local Tycoon

Han Hongwei, born in 1965, started his career in Shanghai in 2004 and established Haiyin Wealth two years later. By the end of 2022, the firm boasted over 2,500 employees, including elites from banking, securities, and trust sectors, providing asset allocation advice, wealth management, and family office services to over 146,000 high-net-worth clients.

Corporate records show that Haiyin Wealth is 85% owned by Haiyin Holding, with Wang Dian holding the remaining 15%. Haiyin Holding is controlled by Han Hongwei with a 99% stake, with his daughter Han Yu owning 1%. At its inception, Haiyin Wealth made a notable splash with its registered capital of 500 million yuan, instilling confidence among investors.

Within just a few years, the company expanded to over 80 cities nationwide, with assets under management growing exponentially. In 2019, a lavish appreciation event was held at the Ritz-Carlton hotel in Guangzhou, celebrating the company's achievements.

In March 2021, Haiyin Wealth was listed on the Nasdaq, presenting itself as China's third-largest and fastest-growing independent wealth management service provider. Its prospectus emphasized its position as the largest fixed-income product provider for real estate, noting investments in projects backed by major developers such as Evergrande and Sunac.

In 2023, Han Hongwei and his son Han Xiao were featured on the Hurun Rich List with a combined fortune of 6 billion yuan, earning them the title of the wealthiest family in Yongcheng, Henan. As of June 2023, Haiyin Wealth operated 185 wealth management centers across 91 cities, with over 1,700 financial advisors serving 46,600 active clients.

After weathering redemption crises, delisting, and police investigations, the Han family now confronts criminal penalties. Shanghai Guijiu, a related venture, is also mired in severe judicial and operational crises, reporting revenue of just 39.94 million yuan in 2025, a year-over-year decline of 86.17%, with continued losses of 266 million yuan. It was delisted from the A-share market in June 2026, becoming the first liquor company to be removed from the exchange, with its final share price at 1.31 yuan and a market value of around 438 million yuan.

Legal experts suggest that given the sheer scale of 71.69 billion yuan, the widespread fabrication of underlying assets, and the family's interconnected operations, the principal offenders face significant risks of life imprisonment, substantial fines, and asset confiscation. Referencing precedents like Yizubao and Fu Xing Group, where similar charges led to severe sentencing, the penalties are likely to reflect the logic that larger scale, more thorough fabrication, and greater difficulty in recovering funds warrant harsher outcomes.

The core issue for the Han family may not hinge on whether they receive heavy sentences but rather on the effective execution of financial penalties. Given that substantial assets have been transferred overseas or laundered through cryptocurrencies, the domestically executable assets are limited. Consequently, the length of their sentences may depend on their willingness to voluntarily return illicit gains.

For the victims, the primary concern remains the amount of money they can recover and the methods for doing so. The fundamental principle in illegal fundraising cases is to maximize asset recovery and ensure lawful restitution to participants according to legal procedures. Seized assets typically undergo judicial confirmation, disposal, and liquidation before uniform repayment is made to victims. If recovered assets are insufficient to cover all losses, restitution is distributed proportionally based on each participant's contribution rather than on a first-come, first-served basis.

Victims' claims generally take priority over ordinary civil debts and the payment of fines or confiscated assets. Investors are advised to ensure their information is registered within the case's scope, report losses to authorities, and preserve documentation such as investment contracts, payment records, product descriptions, and redemption statements. They should also stay informed through official channels and carefully verify details like principal amounts and already received returns, as these will directly influence loss assessments and restitution amounts.

Regarding the reported recovery of 1.82 billion yuan, lawyers caution that while this figure reflects assets already seized or frozen, it does not necessarily mean that amount is immediately available for cash repayment. Some assets may involve ownership disputes, mortgages, third-party claims, or liquidation challenges, and the final restitution amount will need to be determined through legal procedures.

The curtain has only just risen on this trial, and the full picture of the truth is yet to be revealed. More than 200 attendees and victims await not only a verdict but also clear answers regarding the ultimate destination of the 71.69 billion yuan. Will the Han family's repeated claims of ignorance prove to be mere evasion, or do they point to deeper complexities? As proceedings advance, more details are expected to come to light.