Much like Bernie Madoff, the Ezubao lending platform promised investors above-market returns of between 9% and 14.6%. The lender, which was launched in July 2014, had ensnared some 900,000 investors, Xinhua reported.

One of those arrested was Ding Ning, Ezubao’s 34-year-old founder. He allegedly put money from new investors into Ezubao’s own real estate projects and used it to pay off existing investors. Xinhua also reported that Ding spent some of the money on gifts, such as a $20 million villa in Singapore for Zhang Min, president of Ezubao owner Yucheng Group and one of those arrested, as well as a $1.8 million pink diamond.

In theory, China’s P2P platforms are supposed to invest the money they raise into products from third parties, such as property developers.

According to the Financial Times, Ding was not be available for comment, but Ezubao’s risk controller, who is also under arrest, was quoted by Xinhua as admitting that “95 per cent of [our] projects are fake.” Police were quoted in state media as saying that only one of of the 207 companies that supposedly received investments from Ezubao actually did.

Police raided the company, based in the eastern province of Anhui, after learning that its owners were moving money and preparing to flee.

French news agency AFP reported that Internet users in China were split in their opinion of the raid. One investor asked on China’s Twitter-like Weibo, “Does our money just evaporate like that?”

But in another posting, another user wrote that, “Investors must sharpen their eyes facing various seductions. Never go after petty advantages and always remember there is no free lunch.”