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US Arrests Chinese Billionaire Over Rap Fraud

NEW YORK — A Chinese tycoon closely linked to an aide to former US President Donald Trump has been arrested in New York and accused of extorting $1 billion from supporters of his anti-Beijing activities.

The US Department of Justice accused Guo Wengui and still-at-large British co-conspirator Je Kin Ming of stealing funds from participants in an investment program so they could buy luxury goods, including a yacht, a 4,645-square-foot mansion and a 3.5 -Dollar- Million Ferrari.

A court official said late Wednesday that Guo, who is also wanted in China, has pleaded not guilty but agreed to be detained at a preliminary hearing.

Hours after his arrest at 6 a.m. at his Manhattan penthouse apartment overlooking Central Park, a fire broke out in his building, raising suspicions that the two might be linked.

Guo’s arrest comes nine years after the former real estate billionaire fled China in 2014 after being accused of fraud and corruption, though he has become an outspoken critic of bribery within the Chinese government.

Going by his Cantonese name, Ho Wan Kwok, the Justice Department said Guo used his notoriety as a critic of Chinese leader Xi Jinping’s government in exile in New York to garner a large following online.

These supporters were encouraged to donate to or invest in Guo-controlled nonprofits and companies, including GTV Media Group, of which Steve Bannon, a key adviser to Donald Trump, was a director.

This activity spread to other avenues to raise hundreds of millions of dollars, including a luxury club, the issuer of the cryptocurrency Himalaya Exchange and the Himalaya Farm Alliance, which promised investors discounted shares of GTV.

But the Justice Department said Guo and Je diverted funds for their own use, including Guo’s New Jersey home and yacht, a custom Bugatti sports car and two mattresses, each costing $36,000.

In 2021, US tax authorities labeled GTV’s investment solicitation an illegal public offering and forced Guo to repay nearly $500 million to investors and pay nearly $40 million in fines.

Since then, authorities have seized about $634 million of funds collected from Guo and Je in consecutive actions since then, charging the two on multiple counts of securities fraud, wire fraud, money laundering and obstruction on Wednesday.

“Fraudulent investment scams victimize innocent people and ultimately damage public confidence in the integrity of financial systems,” said FBI Deputy Director Michael Driscoll.

Raid on billionaires

Guo arrived in the United States in 2015 after fleeing a crackdown on China’s classy billionaires and corrupt officials by the Xi government.

He was accused of paying hefty bribes to a powerful intelligence and security chief.

But he claimed he was the victim of a business dispute with a former top Communist Party official.

He later claimed to have details of dealings with Wang Qishan, Beijing’s all-powerful anti-corruption czar and later China’s vice president.

He landed in the United States with a bang, bought a $67.5 million Manhattan penthouse and presented himself as being persecuted by the Chinese government by seeking political asylum.

In 2017, at Beijing’s request, Interpol issued a Red Notice – a non-binding arrest warrant – calling for Guo’s arrest and extradition.

She sent security officials to New York to urge him to return. And it recruited sympathetic US businessmen with ties to Trump to persuade him to deport Guo.

Alliance with Bannon

But Trump’s Washington did nothing, and in late 2017, after leaving his White House job, Bannon began working with the Chinese tycoon.

Together, they built strong political media operations, including Guo’s broadcasts to China and Bannon’s War Room podcast, which remains strongly pro-Trump and anti-China.

Bannon has now reportedly been paid a million dollars as a consultant by Guo, whom he promoted on his podcast.

In early 2020, they formed a lobby group against the Chinese Community Party, New State of China.

When Trump lost his 2020 reelection bid, the two jointly backed the unsubstantiated claim that massive voter fraud caused his defeat.

At the time, both were under federal investigation.

In 2020, Bannon was arrested for defrauding donors while onboard Guo’s $35 million yacht, which was anchored off Connecticut.

A year later, Guo’s use of his network of nonprofits and investment schemes to raise hundreds of millions ran into trouble when they were forced to settle $539 million in SEC fraud allegations.

In 2022, Guo broke a court order and moved his yacht out of the United States to avoid confiscation.

When a judge fined him $134 million for doing so, he filed for bankruptcy to protect his assets.

Source: Crypto News Deutsch

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