China will strengthen supervision on public fund deposits to safeguard the healthy development of the financial sector, according to a draft bill on illegal fundraising.
The State Council Thursday requested public opinion on a draft law on the prevention and punishment for illegal fundraising. Members of the public can visit the State Council's Legislative Affairs Office website to make suggestions and comments on the draft until Sept. 24.
Local authorities should establish a supervision mechanism on targeting illegal fundraising, the draft said, adding information on how to prevent financial fraud and information sharing between different departments are also necessary.
The draft law also encourages local governments to reward whistle-blowers and follow up on tip-offs about illegal fundraising .
Financial institutions, including banks, found to have committed fraudulent fundraising will be fined from one to five times the amount of the illegal gains, while individuals directly responsible could face penalties of up to 500,000 yuan (75,000 U.S. dollars) and revocation of their occupational license, according to the draft.
