Chinese authorities are struggling to quell protests following the collapse of an investment scheme police say took as much as US$4.7 billion from millions of depositors.

The implosion of Qianbao.com adds to a string of failures of Chinese financial ventures blamed on fraud or mismanagement that have prompted protests and complaints of official indifference to the suffering of small investors. In a separate case, the founder of an online lender was sentenced in September to life in prison on charges he defrauded investors of US$7.7 billion.

Hundreds of people marched in freezing weather in the eastern city of Nanjing in Jiangsu province yesterday, where Qianbao was founded in 2012, shouting for the government to take action. A video shot by a demonstrator showed police carrying some people away while others shouted, "The Jiangsu government is beating people!”

"Don’t organize and don’t participate in illegal activities,” the official Xinhua News Agency told readers in a report on Qianbao.com.

Depositors protested in Nanjing on December 12 after they lost access to online accounts, according to Zhan Jianfu, an employee of an auto dealership in the western city of Mianyang. He said he invested several hundred thousand yuan in Qianbao.

"We failed to get a response and some of the investors were intercepted and beaten up,” Zhan said in a telephone interview.

Qianbao, Chinese for "Wallet,” had as many as 200 million registered users, according to Chinese news reports. The founder, Zhang Xiaolei — dubbed "China’s most notorious swindler” by one newspaper — turned himself in December 26 to Nanjing police, who are leading the investigation.-AP