Chinese businessman with ties to Steve Bannon arrested, charged with fraud, including $500 million crypto scam

Exiled Chinese businessman Guo Wengui was arrested in New York on Wednesday morning and charged with fraud for allegedly orchestrating a series of fraudulent schemes that fleeced retail investors out of a combined $1.4 billion.

Hours after his arrest, Guo’s luxury penthouse on Manhattan’s Upper East Side caught fire and burned for two hours before firefighters were able to extinguish the blaze. The Federal Bureau of Investigation (FBI) is said to be investigating the fire. The 15-room condo is currently on the market for $32.5 million.

Of Guo’s four alleged schemes, three were related to GTV Media Group, the Chinese social media company formed in April 2020 by Guo and Steve Bannon – a longtime ally and former adviser to US President Donald Trump. The three alleged schemes raised an estimated $857 million.

Bannon was arrested on Guo’s yacht, the 152-foot Lady May, in August 2020 and charged with conspiracy to commit wire fraud and money laundering in connection with a crowd-funded effort to build a border wall between the United States and Mexico. Bannon has not been charged with any wrongdoing in connection with GTV.

Guo’s fourth alleged scheme — which the US Securities and Exchange Commission (SEC) said in a separate civil complaint raised $500 million from retail investors — was an unrelated crypto venture called H-Coin, or Himalaya Coin. As of October 2021, Guo founded and promoted H-Coin, telling his followers on social media that the currency was 20% backed by gold and promising to cover “100% of investment losses attributable to H-Coin”.

Four months later, in February 2022, Guo filed for bankruptcy, claiming assets worth between $50,000 and $100,000 and debts of up to $500 million. Despite his claims of poverty, the Department of Justice (DOJ) announced on Wednesday that it seized over $630 million of alleged fraudulent proceeds from 21 different bank accounts controlled by Guo between September 2022 and March 2023.

Before declaring bankruptcy, Guo lived lavishly – a lifestyle advocate says was funded by unsuspecting investors.

“[Guo] is accused of lining his pockets with the money he stole, including buying himself and his close relatives a 50,000-square-foot mansion, a $3.5 million Ferrari and even two $36,000 mattresses, and to finance a $37 million luxury yacht, US Attorney for the Southern District of New York Damian Williams said.

Guo’s US legal troubles are not his first. In 2014, the former billionaire fled his native China in anticipation of fraud charges and became a vocal critic of the Chinese Communist Party. Guo, who is wanted by the Chinese government, filed an application for political asylum in the United States in 2017. That application is still pending.