(Yicai Global) April 4 -- Authorities in Dongguan, Guangdong province have detained 44 people and frozen 2,825 bank accounts containing CNY3.1 billion (USD462 million) in connection to potentially illegal fundraising conducted by Tuandaiwang Internet Technology.

Police officers have also sealed off 35 houses and seized 40 cars and a plane, the local constabulary said on WeChat yesterday, adding that it expects cooperation from investors as it tries to recover the illegally raised funds.

Tuandaiwang claims on its website to be South China's biggest peer-to-peer lender. As of Feb. 28 this year, it had issued 980,000 loans worth CNY14.5 billion (USD2.2 billion) since its formation in 2012, generating almost CNY131 billion in revenue.

But authorities now believe executives at the company may have squandered the money it received from investors, which included a CNY700 million (USD104 million) injection from China Minsheng Investment Group, one of the country's biggest private investment conglomerates. Illegal fundraising in China can entail gathering money through deception and misappropriating or transferring cash raised.

The local police force has been issuing updates on the case via WeChat since March 28, and had received 154,700 reports as of midnight on the morning of March 30. The city has also set up 31 groups to better serve witnesses from other provinces and to help the district police obtain evidence. A special team dedicated to the case has already spoken with 33,800 people regarding the matter.

Officers have obtained 123 terabytes of company data and is working with professional institutions to analyze it. They have also seized servers, computers and other items belonging to the firm, which has had multiple owners since its inception and is now run by Dongguan Tuandaiwang Internet Technology.

Dongguan has also set up a command center to recover the cash and make it easier for debtors to repay their dues. Those who abused the funds can use their company bank card to make payments to a unified collection account. They will need to leave their identification number and name and their personal credit will be affected if they fail to repay.

Editor: James Boynton