"Four individual investors in Tianjin municipality lost 571,000U.S. dollars out of an investment of 639,000 U.S. dollars, in other words 89 percent of their stake," said a spokesman of the Ministry of Public Security (MPS).

Tianjin-based Caizhi Forex Consultancy Co. Ltd. lured individual investors by advertising lectures on foreign exchange trading, he said. The company in fact had no license to deal in forex trading.

Each gullible investor was asked to pay at least 5,000 U.S. dollars as an entry fee and 50 U.S. dollars commission on each trade effected on the online platform of Singapore-based Hudson Global Capital Ltd., according to the ministry.

One of the four victims is a retired teacher who had hoped to earn a large sum through forex dealings. But four months of transactions ended up burning a huge hole in his wallet. Since his investments were illegal, no redress is available to him in Chinese courts.

The other case involved a company called Jilin Hengyuan Consultancy Co. Ltd. based in northeast China.

Masquerading as an agency of the Hong Kong Hantec Group, it used an online platform to transfer 31.7 million yuan (about 4 million U.S. dollars) of Chinese individual investors' funds out of the country in less than 12 months.

According to Chinese law, it is illegal to organize or take part in unlicensed forex and futures dealings.

Since March, the MPS and the State Administration of Foreign Exchange (SAFE) have launched a crackdown on illegal online forex transactions.

"We have unearthed a series of criminal cases and clamped down on illegal services over the last nine months," said the police spokesman.

Online forex trade organizations attract individual investors with "get-rich-quick" schemes, he said, warning Chinese individual investors to stay away from them.

"Domestic investors who are not familiar with the international forex market can easily become the victims of fraudsters," he said.