Protest in China over investment scams-reports

Thousands of protesters converged on a train station in central China, angered over collapsing illegal investment schemes that residents said the government had failed to staunch, according to news reports and a government notice on Monday.

On Sunday, the protesters faced rows of police at the railway station in Anyang, Henan province, where some residents said their wanted to board trains to Beijing to lodge their complaints, Hong Kong's Mingpao newspaper reported.

Pictures in that paper and on China's "Weibo" microblogging site showed thousands of people milling around the square in front of the station, while police watched. The photos, which Reuters could not verify, showed no scenes of violence.

But news reports over past months have shown that collapsing illegal investment schemes have become a serious problem for the government in Anyang, a heavily rural area of 5.2 million people about 500 km (310 miles) southwest of Beijing.

China's ruling Communist Party worries that the tens of thousands of sporadic protests over land grabs, corruption and economic grievances that break out across the country every year could coalesce into discontent that threatens its control. And Anyang, with its mix of economic grievances and suggestions of corruption, illustrates the discontent driving many protests.

On Monday, the Anyang government (www.anyang.gov.cn) issued a notice acknowledging the protest and vowed to take tougher action against the investment schemes, that have promised investors much higher returns than can be gained from banks.

"On New Year's Day, our city experienced a mass demonstration by some people who participated in illegal investments," said the notice from the Communist Party secretary of Anyang, Zhang Guangzhi.

Although officials managed to contain the protest, said Zhang, "this incident has exposed weak links in our handling of the illegal investment schemes."

In October, a Chinese newspaper, the 21st Century Business Herald, reported that many operators of the illegal investment vehicles in Anyang had fled as their schemes for generating high returns from real estate and other investments began to unravel.

Police have also launched investigations into schemes involving hundreds of suspects, the Mingpao newspaper said.

But websites for Anyang residents have echoed with allegations that officials were tardy in cracking down on the schemes.

"If the government hadn't abetted this, there would never have been so many illegal investment schemes," said one earlier message on the Chinese Internet operator Baidu.com's site for Anyang residents.

Messages on the "Weibo" microblogging site said Anyang police sent a text message to residents saying 21 people were detained over the protest. An officer who answered the phone at the Anyang Public Security Bureau refused to comment to Reuters.

Last month, a village protest in southern China over land grabs and the death of a village organiser drew national attention after officials conceded to the protesters' key demands.

No official counts of the number of protests, riots and mass petitions have been released in recent years. But most estimates in government-sponsored studies put such "mass incidents" at around 90,000 a year in recent years.

In 2007, China had more than 80,000 "mass incidents", up from more than 60,000 in 2006, according to the Chinese Academy of Social Sciences.

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