On May 23, protests in rural Henan brought national attention to the fact that five rural banks in the province–禹州新民生村镇银行、上蔡惠民村镇银行、柘城黄淮村镇银行、开封新东方村镇银行、安徽固镇新淮河村镇银行–are no longer allowing clients to withdraw savings. Over 2,900 clients have tried to access over 1.2 billion yuan, and there are reports that this is just the tip of the iceberg because many people have bought financial products that are held by these banks. Estimates suggest that millions may have lost billions. So what’s happened? Where’s the money? And why are people in Henan protesting at banks?

The story began on April 18, when clients who had bought short-term securities were not able to withdraw the money after the financial products had come to term. Their online accounts have either disappeared or are no longer accessible either by computer or bank apps. The day after the incident, an official statement was released explaining that the banks were upgrading virtual services.

Here’s the rub: to date, funds hare still unavailable. Account holders have been gathering at banks, demanding access to their money. The central government is now getting involved. However, it is difficult to figure out what is actually happening because We Chat posts about the crisis are often deleted, while many reports that have been uploaded to youtube are primarily anecdotal.

The key problem seems to be that the financial institutions providing these services have not been legally operating. The primary shareholder in the banks is Henan New Wealth Group 河南新财富集团, which according to official outlets absorbed public funds through internal and external collusion, the use of third-party platforms and fund brokers, and is suspected of other violations. The Group is currently under investigation. Moreover, three of its subsidiaries have been de-registered as of July 2020, while New Wealth itself was de-registered in February 2022. However, not only is the money still missing, the financial products could still be purchased in April of this year.

So, that’s the question du jour: where’s the money? The following video of protests was uploaded to Youtube yesterday, May 24.