The Securities and Exchange Commission announced that it has charged China-based investment adviser QZ Asset Management Limited a/k/a Qianze Asset Management Limited (QZ Asset), its South Dakota-based holding company QZ Global Limited, and the CEO of both entities, Blake Yeung Pu Lei a/k/a Yang Pulei (Yeung), with conducting a global, multi-million dollar fraud scheme.
ThinkAdvisor reported details of the charges, which accuse the defendants of lying to clients and prospective clients regarding the safety of their investments, the investment adviser’s relationships with certain well-known banks and law firms, and the holding company’s initial public stock offering. They allegedly defrauded hundreds of people out of at least &6 million.
The SEC’s complaint states that QZ Asset and Yeung falsely claimed that QZ Asset would use its proprietary AI-based technology to help generate extraordinary weekly returns while promising “100%” protection for client funds. They also claimed that well-known and reputable financial and legal firms were providing services to the company.
According to the SEC, the defendants falsely claimed that QZ Global had applied to have its common stock listed on the Nasdaq Global Select Market and that they had positive communications with SEC staff regarding this effort.
Furthermore, QZ Global allegedly touted its SEC filings, which were materially deficient, to lure clients and prospective clients into handing over their funds to QZ Asset. They then allegedly stopped communicating with clients and QZ Asset’s website, which clients used to access their funds, was taken down.
“The defendants’ brazen fraud alleged in our complaint, including their abuse of the SEC’s filing process to prey on individuals in the United States and across the world, is reprehensible,” said Jason J. Burt, Regional Director of the SEC’s Denver Regional Office. “We will continue to hold accountable those who deceive investors, including by misusing the SEC’s name and processes to provide an air of legitimacy to their fraudulent endeavors.”
The defendants are charged with violating the antifraud provisions of the federal securities laws and seeks permanent injunctive relief, return of allegedly ill-gotten gains, and civil penalties.
The attorneys at Lewitas Hyman include former senior attorneys at the SEC whose legal experience and industry knowledge make them uniquely qualified to provide counsel on securities regulatory, compliance and enforcement matters. Our attorneys fully understand the regulatory scrutiny financial professionals and their firms face from the various regulators that oversee the financial services industry. If your firm is facing an investigation from a regulatory agency, please contact Lewitas Hyman at (888) 655-6002 or through our online contact form.
