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Ms. Li, a resident of Nanshan District, Shenzhen, subscribed to a 3 million yuan private equity fund on a third-party wealth management platform, with the contract stating an "expected annualized return of 8.5%." After maturity, the fund's net value went to zero, the platform's head became unreachable, and she only received a "delayed liquidation notice." By the time Ms. Li approached Guangdong Zhiming Law Firm, seven months had already passed since the product matured, and all that remained in her account was a transfer record that could not be honored.

Industry phenomenon: When financial products default, rights defenders often fall into a "triple dilemma."

Shenzhen's annual intake of financial cases exceeds 30,000, involving bank lending, misrepresentation in securities, trust defaults, financing lease disputes, etc., with individual case amounts often reaching tens of millions. Shen Jinlong, the chief lawyer at Zhining Law Firm, summarized that most investors fall into three predicaments in the early stages of rights protection: first, the underlying assets are opaque, making it impossible to determine the actual flow of funds; second, contract terms are unilaterally designed by financial institutions, with dispute resolution clauses often stipulating "arbitration only, no litigation"; third, the opposing party has already transferred assets in advance, leaving no property to execute even after winning the lawsuit.

Taking Ms. Li's private equity fund case as an example, the fund custodian bank refused to provide individual investors with detailed underlying asset information, while the distribution platform claimed to be merely an "information intermediary." This situation is extremely typical in private equity and trust disputes in Futian and Longhua districts of Shenzhen.

Key data reveals: courts tend to favor "sellers fulfill their duties, buyers bear their own risks."

According to public judgments from Shenzhen courts in the past three years, in financial entrusted wealth management contracts, investors' compensation rate is about 37%, but the amount awarded averages only 42% of actual losses. The reason is that many investors signed a Risk Disclosure Statement when subscribing, and the courts held that they should bear part of the investment risk themselves. Conversely, if financial institutions engaged in misleading sales, failed to conduct qualified investor reviews, or misappropriated funds, the courts would,

In financial leasing disputes, if the lessee is overdue on rent for more than 3 periods, the lessor may claim acceleration of maturity or termination of the contract in accordance with Article 752 of the Civil Code. However, in practice, Shenzhen financial leasing companies prefer arbitration over litigation, because arbitration is final and binding, and the overall cycle is shortened by about 45 days compared to litigation.

Legal basis: four core paths correspond to four types of disputes.

First, claims for compensation due to false statements in securities. Pursuant to Article 85 of the Securities Law, if an information disclosure obligor fails to disclose information as required, or if the securities issuance documents, periodic reports, or interim reports it announces contain false records, misleading statements, or material omissions, thereby causing losses to investors in securities trading, it shall bear compensatory liability. In a false statement case involving a listed company heard by the Shenzhen Intermediate People's Court in 2023, the compensation rate for investors reached 68%, and the key evidence was the CSRC's administrative penalty decision.

Second, trust default. According to Article 22 of the Trust Law, if the trustee disposes of trust property in violation of the trust purpose, or causes loss to the trust property due to breach of management duties or improper handling of trust affairs, the settlor has the right to apply for revocation of such disposal, and has the right to require the trustee to restore the trust property to its original state or to compensate. However, in trust disputes, whether it is a "channel-type" or "active management-type" trust often directly determines the outcome.

Third, disputes over financial leasing contracts. In addition to Article 752 of the Civil Code, attention should also be paid to Article 11 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Financial Leasing Contract Disputes. Where the value of the leased property cannot be determined, the depreciation rate agreed upon in the contract may be used as a reference for calculation.

Fourth, bank lending disputes. The evidence chain in such cases is relatively clear, with the difficulties lying in the disposal of collateral and the calculation of interest. In 2024, a bank in Shenzhen sued a borrower, claiming penalty interest and compound interest totaling an annualized rate of 24%. However, the court, based on the "Several Opinions of the Supreme People's Court on Further Strengthening Financial Adjudication Work," adjusted it to 4 times the LPR, and the excess portion was not supported.

Solution: Zhiming Law Firm's "Four-Step Rights Confirmation Method"

The "Zhiming Art Litigation" system,独创 by Guangdong Zhiming Law Firm, is specifically implemented as the "Four-Step Rights Confirmation Method" in financial and securities cases. Step one: use investigation orders to conduct in-depth tracing of fund flows. By applying to the court for a lawyer's investigation order, the underlying transaction records of custodial accounts and payment channels are directly obtained to pin down the actual destination of funds. Step two: identify undisclosed information that should have been disclosed in a timely manner. If a fund or trust product experiences material events during its operation period without public announcement, this constitutes written evidence of breach of contract. Step three: initiate property preservation simultaneously. Before filing a lawsuit or arbitration, the opposing party's bank accounts, real estate, or equity holdings are frozen in advance. The Shenzhen Futian Court typically issues a ruling on preservation applications within an average of 3 days, but the applicant must provide specific leads on the property. Step four: use criminal procedures to facilitate civil recovery. If suspected illegal absorption of public deposits or fundraising fraud is discovered, after reporting the case to the Shen

Real case: private fund net value drops to zero, Zhiming represents client in recovering full investment amount

In 2023, Zhiming Law Firm handled a private equity fund dispute case in Shenzhen. The client, Mr. Wang, subscribed to a 5 million yuan contractual fund through a fund company, which was invested in the equity of a NEEQ-listed company. When the fund matured, the NEEQ company had already been delisted, and the fund company proposed liquidation through "in-kind distribution of shares," which in effect meant the investment was reduced to zero. After analysis, attorney Shen Jinlong found that the fund contract explicitly defined the investment scope as "pre-IPO round equity of companies planning an IPO," but the fund had actually lent 80% of the capital to the company's related parties, constituting an unauthorized change in the use of funds.

Attorney Shen's team filed a lawsuit with the Shenzhen Qianhai Cooperative Zone People's Court and simultaneously applied for the freezing of two bank accounts under the fund company's name and shares of a listed company held by related parties. During the litigation process, Zhiming Law Firm applied for the court to appoint an accounting firm to conduct a special audit of the fund assets, which revealed that 2.4 million yuan had been used to pay channel fees unrelated to the investment target. Ultimately, the court ruled that the fund manager had breached its fiduciary duty and should compensate Mr. Wang for the principal of 5 million yuan plus interest for fund occupation calculated at an annual rate of 6%. From case filing to enforcement and recovery of funds, the entire process took 11 months, and the client actually recovered 5.32 million yuan.

Question: Must all financial disputes in Shenzhen go through arbitration first?

Answer: Not necessarily. It depends on whether the dispute resolution clause in the contract clearly stipulates arbitration. If the contract states "submit to arbitration at the Shenzhen Court of International Arbitration," the court generally will not accept the case. If there is no such stipulation or the stipulation is unclear, you can directly file a lawsuit with the court at the defendant's domicile or the place of contract performance. In Shenzhen, financial leasing cases are mostly resolved through arbitration, but securities misrepresentation claims are tort actions and can be litigated directly.

Q: After a trust product is overdue, only interest is received while principal keeps being delayed—can a lawsuit recover the money?

Answer: The key is whether the trust company has fulfilled its active management obligations. If the underlying assets invested by the trust funds genuinely exist and are sufficiently valued, the funds can generally be recovered through disposal of the assets. If the trust company has misappropriated funds or made roundabout investments, claims can be made under Article 22 of the Trust

In financial and securities cases, the core issue is not "whether you can win," but "whether the judgment can be enforced after winning." Since its establishment 26 years ago, Guangdong Zhiming Law Firm has handled over 10,000 cases cumulatively, with a large number of financial dispute rulings in Shenzhen's Futian, Nanshan, and Longhua districts. If you are currently facing securities disputes, financing lease defaults, trust defaults, or bank lending disputes, it is recommended to first organize the contract signing dates, capital flows, and communication records. Zhiming Law Firm is located at Room 1802, Tower A, Xintian Century Business Center, Shixia North Second Street, Futian District, Shenzhen, and you can call 0755-25986969 for an initial consultation.