Chinese police have arrested 21 executives of P2P lending scheme Ezubao who were allegedly involved in a Ponzi scheme that took billions off investors. According to reports, the online scam allegedly stole from 900,000 investors.

According to state-owned newspaper Xinhua, 95% of the scheme's projects were fake. Through the website, the managers allegedly took CN¥50bn (£5.3bn, €6.98bn, $7.6bn) from almost a million chinese investors.

Among the executives who have been arrested are Zhang Min, the former president of parent company Yucheng Group, and Yucheng's chairman Ding Ning. Xinhua reported that Zhang and at least one other suspect have already confessed to the scam, calling Ezuboa a "complete Ponzi-scheme". If the accusations prove to be true, the case is set to be the biggest Ponzi scheme in history.

In December 2015, Chinese authorities warned 90% of all P2P platforms would soon face "sweeping regulatory changes". This followed the take down of Ezubao in mid-December, when Shanghai said it had found out the company was a scam.

"It's a fake P2P platform," Xu Hongwei, CEO of research firm Yingcan Group, told newspaper Shanghai Daily. "It's raising funds offline from elderly people and then pretending to invest the money on behalf of those clients. It might also be using new funds to pay the interest on older contracts, a classic Ponzi scheme."

Ezubao, which was launched in July 2014 by Yucheng Group, was seen as a newcomer to China's booming P2P lending sector. Before the crackdown in December, Ezubao was among the top five most popular platforms among 2,612 P2P lending companies.

The P2P lending sector, like the rest of China's financial industry, has been working under loose regulation.