Chinese authorities arrested 21 people for involvement in an online peer-to-peer (P2P) lender scam that defrauded some 900,000 people out of more than 50 billion yuan ($7.6 billion, 7 billion euros), reported state-run Xinhua news agency late Sunday.

Deemed China's fourth largest Internet P2P lender by Beijing-based business magazine Caixin, Ezubao offered investors between nine to 14.6 percent annual return on their investments. However, 95 percent of Ezubao's projects "were fake," a former executive told investigators.

Dozens of protesters demonstrated in front of the company's Beijing office demanding that their money be returned.

State-media reported that two company executives confessed that the projects aimed at defrauding investors. "Ezubao is a typical Ponzi scam," said Zhang Min, president of Yucheng Group, which launched Ezubao in July 2014, reported Xinhua news agency.

Beijing has also struggled to cutoff illegal investment instruments that promise investors higher returns when compared to the country's low-interest rate banks. Chinese investors have also opted for alternative mechanisms in the world's second-largest economy following turmoil in its highly-speculative stock market.

In January, China's central bank - along with other ministries and government agencies - issued a warning to citizens regarding MMM Global, a Russia-based company that promised up to 30 percent monthly returns, and its China arm. Investors could enter MMM's wealth management program using the digital currency Bitcoin, which Beijing barred financial entities from using in 2013.

Chinese President Xi Jinping's anti-graft drive has resulted in several high-profile convictions, including former security chief Zhou Yongkang, who was sentenced to life in prison in June 2015.

Watch video 00:37 Ezubao investors demand money back | DW

ls/rg (AFP, AP, Reuters,dpa)