Remember CDOs? Murky, illiquid investments, backed by bulge-bracket firms that offered lots of yield over similar-rated corporates - just don't ask questions. As SCMP's Shirley Yam reports,China's so-called "trust" products, promise high returns with big-name backing, but a scheme touted at Ping An Bank highlights just how murky the world of mainland investment offerings is. After reading this, we suspect, that last trace of faith that the PBOC has the Chinese shadow banking system under control (and a growth renaissance is due any moment) will be eviscerated.

As The South China Morning Post's Shirley Yam reports, last year, a sales staffer at Ping An Bank, emailed him an investment proposal titled Ping An Wealth - Handan Hyundai Modern Logistic Port Project.

Hyundai? The South Korean conglomerate? That's interesting.

George clicked on the e-mail to find a trust scheme that promised a fixed annual return of 9 per cent to 11 per cent over two years. It was looking for a total investment of 1.2 billion yuan (HK$1.5 billion).

The scheme looked real.

The proposal said the project involved an investment by Hyundai RNC Investment, which was fully owned by Hyundai Engineering and Construction (Hyundai E&C) - an arm of Hyundai Group.

Hyundai RNC guaranteed repayment with cash flow from Hyundai (Handan) International Auto Trade City, a US$1 billion project that included apartments, offices and hotels, according to the proposal seen by Money Matters.

It said Ping An Trust, one of the industry's key players, managed the productwith a long list of risk-control measures. The proposal bears the logo of Ping An Trust.

It looks even more real if you search for the project online in Chinese. In July 2012, Xinhua reported the investment "by Fortune 500 corporation Korea Hyundai Group".

In the official media of Hebei province, where the project is located, there have been lots of reports and pictures of the investment. Among them is the Hebei government making Hyundai RNC's chairman an "honorary citizen".

On YouTube, a video shows Hebei officials meeting some Koreans who are said to be key Hyundai personnel. There is also a website for the project, which is described as an investment of Hyundai E&C.

Yet, when George (who is in the financial industry) searched for the project in English, it was a completely different story.

There is no mention of the project or Hyundai RNC on any of Hyundai's official websites or in any of its publications.

George found the Hyundai RNC website, where family links led to a Japanese adult-entertainment platform and two fashion sites. The website has recently been closed down.

So is it a Hyundai project or not? Money Matters decided to contact all the parties involved.

Hyundai E&C spokesman Son Chang-sung said: "Hyundai RNC is not a subsidiary of Hyundai E&C. The Hebei Auto City is not an investment by us. Nor have any of our officials visited the project."

A call to the number listed on the project website was passed to the administration department, where a woman said: "We don't take media questions." Questions that were faxed were not answered.

Money Matters phoned Shen Shan, who is listed as the contact person for the project's developer in its business registration. Shen said: "Why are you calling me? … I am not an employee of them … I am not involved in the (Auto City) project."

In the meantime, the developer is tangled up in a bitter legal battle with a peer which, it said, had jeopardised its cash flow, according to information posted by both sides on mainland chat rooms.

So what did the Ping An people do to verify the dubious project before pitching it to depositors?

The answer is even more surprising. Ping An Trust spokesman Liu Wei said: "We have never issued the product. Nor have we authorised any institution to sell the product."

Ping An Bank spokesman Xie Shaoping said: "Our bank has never sold the product you mentioned." Xie did not comment on the distribution of the scheme by one of its sales staff.

That leaves the sales staffer who sent the proposal. Money Matters reached him via his work e-mail, "seeking his comments on some trust products".

He replied within an hour saying that he was more than happy to help. Specific questions on the "Hyundai" product e-mailed to him have, however, received no response so far. Nor can he be reached by phone.

Welcome to the mainland's US$1.2 trillion investment trust market, where insufficient internal controls, fierce competition and a muzzled media have made room for all sorts of funny dealings.

If the sales staffer had been working for a bank in Hong Kong, his conversation and e-mail exchange with George would have been recorded. George would have been called up by the risk-control people to check if the sales staffer had explained all the risks.

Where the money collected from this investment proposal will end up is anybody's guess.

Could George's case be an isolated one?

Well, the same "Hyundai" product was marketed by Kunlun Trust, which is owned by China National Petroleum Corp, early last year, according to Kunlun's website.

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So we have renegade sales people in banks selling deals that are anything but what they appear to be, far out of the purview of any regulator, to people desperate for yield (and convinced by a government that no harm will ever come to them) on behalf of firms that are absolutely desperate for liquidity... and the same collateral is used numerous times... rings some awfully worrisome bells as these trusts appear nothing more than giant ponzis (or at best, securitized derivatives levered on the promise of a firm that the customer is clueless to comprehend).

Still think the PBOC can contain this trust market if there is one default or two, or ten?