Financing itself is not illegal, but improper financing behavior may lead to illegal and criminal acts, such as illegal fund-raising and loan fraud.
The main features of illegal fund-raising are as follows. 1. Not approved by relevant departments according to law. Including fund-raising approved by departments without approval authority and fund-raising approved by departments with ultra vires approval authority. 2. Promise to repay the principal and interest to investors within a certain period of time. Debt service includes not only monetary form, but also physical form or other forms. 3. Raise funds from unspecified social objects, namely the public. 4. Cover up the essence of illegal fund-raising in a legal form.