This week, the SEC charged Luca International Group, a Bay Area oil and gas company, with defrauding investors through a $68 million Ponzi scheme. Allegedly, the company and its affiliates targeted Chinese Americans as well as EB-5 investors.
According to the SEC, a woman named Bingqing Yang solicited people to invest in the company despite the fact that the company was allegedly drowning in debt and failing to turn a profit. Allegedly, Yang presented the company as successful and promised investors returns from 20 to 30 percent per year. The allegations state that Yang diverted some of the money for her own personal use and used funds from newer investors to pay back earlier investors.
Allegedly, Luca International Group held seminars at its office and nearby hotels to solicit prospective investors, as well as releasing Chinese-language television advertisements and specifically targeting foreign nationals attempting to gain permanent U.S. residency through the EB-5 program.
Recently, we wrote that the SEC was taking enforcement actions against companies that are using the Immigrant Investor Program EB-5 to defraud investors. Investors should be on alert for opportunities offered by companies claiming to be USCIS “regional centers” or using their regional center status to defraud EB-5 investors.
If you or someone you love has lost money and you suspect investment fraud or misconduct, we invite you to contact a securities fraud lawyer at Meyer Wilson today for a free review of your case.