Evergrande Auto Fake Manufacturing Subsidy Scam

Who Gets Targeted

The primary victims of this scam include major banks, insurance companies, private equity firms, and other financial institutions, as well as large funds and individual investors keen on high-yield projects. Lured by Evergrande Auto's promises of 'AI-powered smart vehicle models' and substantial government subsidies, they invested massive amounts of capital, only to discover before or during project execution that the models were never officially brought to market, resulting in enormous financial losses. Victims generally exhibited blind trust in new technologies and a strong psychological need for high returns, lacking rigorous scrutiny of financial authenticity and compliance.

骗局怎么运作

• Creation of fake projects: In the early stages, Evergrande Auto released sophisticated concept art and technical specifications, along with public demonstration videos of an 'AI smart driving' system, to project an image of high-tech, low-cost innovation and attract investor interest.
• Fabrication of financial statements: The company submitted financial and cash flow statements containing exaggerated data, such as inflated R&D expenditures and falsified production line efficiency, while using forged third-party audit reports to mislead investors into believing the company was well-capitalized and operationally sound.
• Obtaining government subsidies: Leveraging fake technical documentation and projected production capacity, the company applied for new energy vehicle subsidies from local governments. They submitted forged technical assessment reports and production estimates, which were approved by government auditors who failed to verify the actual progress of the projects.
• Issuance of large-scale bonds: Based on the aforementioned fraudulent financial and technical projections, Evergrande Auto issued 20.8 billion yuan in corporate bonds in 2024, attracting participation from banks, insurance companies, and retail investors to secure additional financing.
• Termination of partnerships and withdrawal of capital: After failing to achieve production capacity, Evergrande Auto proactively terminated partnerships with potential strategic investors and withdrew previously obtained subsidies. This led to funds being diverted for short-term liquidity needs, ultimately resulting in the depletion of the company's cash flow and its subsequent bankruptcy liquidation.

红旗信号（看到这些快跑）

• 🚩 Project concepts and actual manufacturing bases do not exist or have not officially commenced operations.
• 🚩 Financial statements and audit reports contain obviously unreasonable figures or lack key audit disclosures.
• 🚩 Lack of on-site inspections and verification of progress during the government subsidy approval process.
• 🚩 During the bond issuance period, a large number of institutional investors subscribed in a short period and subsequently withdrew their capital.
• 🚩 Project leads and former executives frequently change identities and reorganize across multiple media outlets and investment institutions.

真实案例

• 2023-08-24: Evergrande Auto reached a $500 million strategic investment agreement with NWTN Group, which was touted as a key financial pillar. However, just one month later, the agreement was withdrawn due to disagreements over debt restructuring, leading to the immediate recall of shareholder funds, as reported by Caixin and The Paper.
• 2024-05-10: Evergrande Auto publicly issued 20.8 billion yuan in corporate bonds, promising to focus on new technology R&D and production line expansion to achieve mass production. Bond buyers included banks, insurance companies, and various institutional investors. Subsequently, the company announced the suspension of personnel and project progress due to a broken capital chain, with information disclosed in Wallstreetcn and official announcements.
• 2025-04-01: The Guangdong Provincial High People's Court ordered the bankruptcy liquidation of Evergrande New Energy Vehicle Technology (Guangdong) Co., Ltd. and Hengchi (Guangzhou) Auto Sales Service Co., Ltd. The company had burned through a total of 110.8 billion yuan while delivering only about 2,800 electric vehicles. Relevant information can be found in People's Daily and Xinhua News Agency.
• April 2024: Evergrande Auto announced the termination of the $500 million strategic investment from NWTN Group, with no further progress on the debt-for-equity swap agreement. The $500 million strategic investment agreement reached in August 2023 had previously been announced as a key financial pillar, only to be withdrawn months later due to debt restructuring disputes. (Source: https://www.jiemian.com/article/11009872.html)
• June 2024: Evergrande Auto announced late at night that it had been ordered to stop production and sales. Local administrative departments demanded the return of approximately 1.9 billion yuan in various rewards and subsidies already issued. The company stated it would apply to the Hong Kong Stock Exchange for the resumption of share trading. In March 2024, Evergrande Auto's annual performance announcement on the HKEX showed a total net loss of over 10 billion yuan. (Source: https://www.nbd.com.cn/articles/2024-06-11/3422995.html)

Official Stance

• 2026-04-28: Issued the 'Announcement on Cracking Down on Fraudulent Applications for New Energy Vehicle Subsidies,' explicitly stating that Evergrande Auto's model car project violated subsidy policy management regulations.
• 2026-05-12: Reported on the irregularities in Evergrande Auto's corporate bond issuance and ordered a halt to further financing.
• 2026-06-01: Published the administrative penalty decision regarding Evergrande Auto's suspected false advertising and irregular subsidies.

How to Protect Yourself

• ✅ Require potential investors to audit the company's authentic financial statements and verify whether the auditing firm is an independent third party.
• ✅ Conduct on-site inspections and production progress confirmation by professional third-party institutions before signing subsidy application documents.
• ✅ Perform due diligence on corporate bond issuances, focusing on the background of subscribing institutions and checking for misleading promotional materials.
• ✅ Establish multi-channel capital monitoring mechanisms to timely detect fund flows and large-scale receipts, and perform forensic audits on abnormal transaction amounts.