Chinese police questioned 27 people, detained 12 and “severely” reprimanded 15, over the spreading of gossip about Linshang Bank – a lender with 61 billion yuan ($9.1 billion) in deposits – which caused a rare bank run in Eastern China.
The South China Morning Post reports that a few disgruntled employees at Shandong Sanwei Oil Group, an agricultural processing company, were unhappy after they were placed on leave when production lines were closed at the firm.
The employees spread a rumour that the firm was collapsing with billions of yuan in unpaid loans and that it might also bring down Linshang Bank, the report added. The rumour spread quickly among residents, triggering a run on the local branch of the bank, according to the article. At one point more than 500 depositors gathered outside the branch demanding to withdraw their money.
The bank said in a brief statement on its website that the spate of withdrawals at one of its branches in Linyi in Shandong province on Monday was caused by ‘a few individuals spreading rumours’ that the bank was in trouble.
The lender urged the public ‘not to believe in or spread rumours to jointly maintain good financial order’.
“In the face of rumors, we hope the public reacts rationally, does not believe in rumors, does not rumor-monger, to avoid harming their own interests.”
This post was published at Zero Hedge on Aug 12, 2017.