Gu Chunfang is seen in a short film promoting Changshu's image. [File photo]

Gu, 40, was born in Changshu and is divorced. She failed to graduate from junior high school, but there were claims that she had become popular in business circles and with officialdom because of her beauty.

Before starting her businesses, she was a model for a clothing company and lead actress for a firm that made publicity films for the city.

Zhou, boss of the Changshu Carp Gate Restaurant, set up many subsidiary companies and used some as guarantors for others to attract large sums of money from banks and private lenders as investments, a local businessman said.

Much of his property, including a Rolls-Royce, had been divided up among some major private creditors after he disappeared, the businessman said.

The city government said they were still collecting information from victims in both cases so the amount of money involved could still rise.

On their microblog, Changshu police have been advising caution over private lending because of the high risks involved.