Taiwanese-American financier Danny Pang (彭日成), accused by US federal regulators of defrauding investors out of hundreds of millions of dollars, was arrested on Tuesday by the FBI on charges he withdrew about US$360,000 from a company account through dozens of small transactions so he would not have to report the sum to federal regulators.
The US attorney’s office said the founder and former chief executive of the Private Equity Management (PEM) Group was arrested at his lawyer’s office in Santa Ana, California.
The Securities and Exchange Commission filed a lawsuit on Friday against Pang and Private Equity Management Group LLC, accusing him of bilking investors by falsely portraying returns as coming from investments in timeshare real estate and seniors’ life insurance policies. Regulators say the money in fact came from a ponzi scheme in which he used funds raised from newer investors to pay earlier ones.
A federal court froze his assets and those of his two California companies, Private Equity Management Group Inc and Private Equity Management Group LLC. The judge also appointed a receiver responsible for safeguarding assets held by Pang’s firms.
Pang founded a US$4 billion investment firm and has lived lavishly in Newport Beach.
He was to spend the night in jail and face arraignment yesterday, prosecutors said. He faces a maximum of 10 years in federal prison if convicted of structuring the cash transactions.
About 16,000 Taiwanese investors purchased more than US$700 million in securities sold by the PEM Group, Financial Supervisory Commission (FSC) Chairman Sean Chen (陳沖) said yesterday.
The legislature’s Finance Committee later passed a resolution requiring the FSC to prohibit banks from selling foreign securities until an investigation into the PEM Group’s activities has been completed.
The FSC chief agreed to the temporary ban, but persuaded lawmakers to limit the restriction to sales of foreign investment products to individual clients so that companies could continue to buy foreign securities.
Chen said the FSC had approached an international agency for assistance in its investigation in the hope of minimizing the impact on Taiwanese investors.
The banks that sold PEM Group products have until tomorrow to file applications for assistance in protecting their clients’ rights, Chen said, but added that he was not certain whether investors would be able to get their money back.
“As long as their life insurance policies and other papers are valid, they will probably not lose their entire investment,” Chen told the Finance Committee.
He dismissed local media reports that as many as 20,000 investors had been affected.
Chen told the committee that the PEM Group had sold its products through six local banks: Standard Chartered Bank (渣打銀行), EnTie Commercial Bank (安泰銀行), Bank SinoPac (永豐銀行), Cosmos Bank (萬泰銀行), Hua Nan Commercial Bank (華南銀行) and Taichung Commercial Bank (台中商銀).
Standard Chartered sold about US$221 million in PEM Group securities, Hua Nan US$205 million, Bank SinoPac US$146 million, Taichung Bank US$70 million, EnTie Bank US$52 million and Cosmos Bank US$48 million, Chinese Nationalist Party (KMT) Legislator Alex Fai (費鴻泰) said.
Bank SinoPac said it would not rule out joining forces with other banks in seeking to claim compensation for their clients.
Standard Chartered Bank said late last night it would repurchase all the PEM Group products it had sold at full face value plus accrued interest.
CLASH OF WORDS: While China’s foreign minister insisted the US play a constructive role with China, Rubio stressed Washington’s commitment to its allies in the region The Ministry of Foreign Affairs (MOFA) yesterday affirmed and welcomed US Secretary of State Marco Rubio statements expressing the US’ “serious concern over China’s coercive actions against Taiwan” and aggressive behavior in the South China Sea, in a telephone call with his Chinese counterpart. The ministry in a news release yesterday also said that the Chinese Ministry of Foreign Affairs had stated many fallacies about Taiwan in the call. “We solemnly emphasize again that our country and the People’s Republic of China are not subordinate to each other, and it has been an objective fact for a long time, as well as
‘CHARM OFFENSIVE’: Beijing has been sending senior Chinese officials to Okinawa as part of efforts to influence public opinion against the US, the ‘Telegraph’ reported Beijing is believed to be sowing divisions in Japan’s Okinawa Prefecture to better facilitate an invasion of Taiwan, British newspaper the Telegraph reported on Saturday. Less than 750km from Taiwan, Okinawa hosts nearly 30,000 US troops who would likely “play a pivotal role should Beijing order the invasion of Taiwan,” it wrote. To prevent US intervention in an invasion, China is carrying out a “silent invasion” of Okinawa by stoking the flames of discontent among locals toward the US presence in the prefecture, it said. Beijing is also allegedly funding separatists in the region, including Chosuke Yara, the head of the Ryukyu Independence
‘VERY SHALLOW’: The center of Saturday’s quake in Tainan’s Dongshan District hit at a depth of 7.7km, while yesterday’s in Nansai was at a depth of 8.1km, the CWA said Two magnitude 5.7 earthquakes that struck on Saturday night and yesterday morning were aftershocks triggered by a magnitude 6.4 quake on Tuesday last week, a seismologist said, adding that the epicenters of the aftershocks are moving westward. Saturday and yesterday’s earthquakes occurred as people were preparing for the Lunar New Year holiday this week. As of 10am yesterday, the Central Weather Administration (CWA) recorded 110 aftershocks from last week’s main earthquake, including six magnitude 5 to 6 quakes and 32 magnitude 4 to 5 tremors. Seventy-one of the earthquakes were smaller than magnitude 4. Thirty-one of the aftershocks were felt nationwide, while 79
GOLDEN OPPORTUNITY: Taiwan must capitalize on the shock waves DeepSeek has sent through US markets to show it is a tech partner of Washington, a researcher said China’s reported breakthrough in artificial intelligence (AI) would prompt the US to seek a stronger alliance with Taiwan and Japan to secure its technological superiority, a Taiwanese researcher said yesterday. The launch of low-cost AI model DeepSeek (深度求索) on Monday sent US tech stocks tumbling, with chipmaker Nvidia Corp losing 16 percent of its value and the NASDAQ falling 612.46 points, or 3.07 percent, to close at 19,341.84 points. On the same day, the Philadelphia Stock Exchange Semiconductor Sector index dropped 488.7 points, or 9.15 percent, to close at 4,853.24 points. The launch of the Chinese chatbot proves that a competitor can
RSS