PYRAMID-SCHEME PROBE: NEW ZEALAND POLICE FREEZE $70 MILLION – ONE OF 2 LARGE CASES INVOLVING SCAMS IN CHINA

On 25th June, the Otago Daily Times reported that nearly $70 million in bank accounts has been frozen in the largest case of its kind in New Zealand – as part of a global investigation into a wealthy Chinese businessman accused of running a massive pyramid scheme from Canada.  Xiao Hua Gong (aka Edward Gong), arrested in Canada in December, built a business empire in Toronto including a hotel chain and TV channels, as well as attending fundraisers for Canada’s Prime Minister Justin Trudeau and donating to the governing Liberal Party.  He denies that his success and influence was gained from an alleged $202 million pyramid scheme selling medicines in China.  The newspaper reports that $77 million over 7 years was moved from China into the New Zealand bank accounts by associates of Gong, according to the police, with most of the money deposited between December 2014 and April 2016 when the pyramid scheme was allegedly running.

In another case reported in the article, police in New Zealand also restrained at least $40 million of belonging to William Yan (aka Bill Liu) alleging they were purchased using the proceeds of a $130 million fraud in China.  He agreed to pay $43 million – without admitting civil or criminal liability – the largest settlement in the history of the Criminal Proceeds Recovery Act and agreed to return to China to face trial where he pleaded guilty to embezzlement.  He also agreed to be charged with money laundering in New Zealand and was sentenced to 5 months of home detention after pleading guilty.

https://www.odt.co.nz/news/national/pyramid-scheme-probe-nz-police-freeze-70m

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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