Chinese trader is exposed as a fake over US bank claims

The little-known businessman shot to fame in January when state media reported he had taken over Delaware-based Atlantic Bank. The acquisition brought him much praise, with his home town giving him a prestigious political appointment and state media calling his business experience “legendary”.

The only thing that may have been legendary, however, was Lin’s audacity. Not only did he not buy Atlantic Bank in Delaware for $60m but there is no Atlantic Bank in that state.

He is now under arrest for an unrelated fraud and has been forced to give up his municipal-level appointment to the Chinese People’s Political Consultative Conference, the government’s top advisory body.

The 41-year-old’s short, spectacular rise and fall shows how fakery has evolved in China, morphing from the manufacture of copycat goods to entire institutions and careers.

Last year, officials found five fake Apple stores in the south-western city of Kunming.

In early June, local press in eastern Shandong province exposed a fake university.

Students who did not score highly enough on the national college entrance exam to make it into university received sham admission letters to the Shandong Institute of Light Industry, a real school.

Lin told Chinese reporters it took him two years to negotiate the purchase of the US bank, and that the bank had declared bankruptcy in 2008 because of the financial crisis.

To add more flair to the story, he claimed it had been running for 85 years and was run by Jews, who are stereotypically seen by many Chinese as having superior business skills.

His claims also cheered his home town, the eastern city of Wenzhou, which was reeling from a government-imposed credit crunch that had ruined some highly leveraged entrepreneurs, some of whom fled the city and their debts. A few committed suicide.

But his tale attracted so much attention journalists familiar with US banking regulations checked into the legitimacy of Lin’s claims.

When his non-existent bank was exposed, Lin said he made “exaggerations” to raise his social status and to win future opportunities in banking.