SHANGHAI, April 17 – A 28-year-old woman once ranked as one of China\’s 100 richest people faces the death penalty for allegedly running the country\’s largest Ponzi scam, state media reported Friday.
Wu Ying pleaded not guilty in a court in east China\’s Zhejiang province where she was accused of running a 390-million-yuan (57-million-dollar) scam in which phoney profits were paid to clients by stealing from new customers, the China Daily reported.
"I could repay the money if I had not been arrested," she was quoted as saying by the official Xinhua news agency.
She said she had been misled into confessing before the trial, Xinhua said.
The Ponzi, or pyramid, scheme was the largest of its kind in China, the China Daily said, without providing further details.
The source of Wu\’s estimated 3.6-billion-yuan fortune was a mystery when she was ranked 68th on a 2006 rich list compiled by the Hurun Report, a magazine that tracks China\’s wealthy, the China Daily said.
She was arrested in February 2007, just months after appearing on the list.
The farmer\’s daughter opened a hair salon in 1997 that she quickly built up into a business empire, according to Xinhua.
As head of the Zhejiang-based Bense Holding Group, Wu allegedly amassed the money from 148 investors between 2005 and 2007 by promising returns of three to 10 percent per month, Xinhua reported, citing prosecutors.
Wu\’s lawyer, Yang Zhaodong, told the court she had done nothing illegal and only borrowed money from friends, the report said.
Wu\’s friends in turn collected money from others, Yang said, adding she should not be held responsible for their actions.
She had used the money to invest in profitable businesses such as hotels, trading companies and property developments, he said.
In January, seven people who allegedly collaborated with Wu were convicted of fraud and received jail sentences ranging from 22 months to six years and fined between 20,000 yuan and 300,000 yuan.