Saturday, 26 July 2014
Last updated 13 hours ago
Apr 7 2009 | 2:44am ET
There certainly is no shortage of alleged Ponzi schemes to keep regulators busy these days. The latest comes from Texas, via Toronto, with the Securities and Exchange Commission accusing Weizhen Tang of running a US$75 million scam.
According to the SEC, Tang told investors in February that he had used money newly-raised from clients to pay profits to others after more than two years of trading losses. The SEC complaint comes after allegations by the Ontario Securities Commission that Tang failed to disclose some US$15 million in losses in 2007 suffered by his Oversea Chinese Fund, which is based in Toronto. The Oversea fund is one of six entities named as defendants in the SEC suit, alongside Tang’s Plano, Texas-based WinWin Capital Management.
A federal judge in Dallas has frozen assets and appointed a receiver at the SEC’s request. Last month, the OSC barred the Oversea fund from trading as it completes its investigation.
Tang is denying any wrongdoing, and says he never confessed to running a Ponzi scheme.
He told Bloomberg News that, while his firm had had “difficulties,” he had not misappropriated any money. He called the situation “very complicated;” WinWin’s lawyer said the firm is “cooperating completely with the SEC and their receiver.”
The SEC says Tang raised as much as $75 million for the fund that it says became a Ponzi scheme. He allegedly targeted Chinese-Americans, including in the Dallas area and in California, telling investors in recent weeks that he hoped to raise $1 million in new money to continue trading and make back his losses.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…