Feds Arrest and Charge Exiled Chinese Billionaire in Massive Crypto Fraud • The Register

Meet the newest member of the crypto rogues gallery: Ho Wan Kwok, aka Guo Wengui, aka Miles Guo, whom the US Department of Justice arrested on Wednesday over what investigators have described as a “vast and complex scheme … to solicit investments in various devices and programs through false statements and representations to hundreds of thousands of Kwok’s online followers.”

Kwok/Guo has a fascinating backstory. He was born in China, became a real estate developer and was ranked as a billionaire. He left China in 2014 as several controversies swirled around his interests and actions, and in 2017 he was living in New York and became a sharp critic of the Chinese government, circulating vivid theories about his problems and Beijing’s role in them.

His position appears to have irked Beijing: The Australian Strategic Policy Institute think tank discovered a state-sponsored disinformation campaign portraying him as “corrupt and untrustworthy.”

While living in the United States, Guo made a new friend: Steve Bannon, the right-wing provocateur who served as managing director of Donald Trump’s first US presidential campaign and later became a senior White House adviser. Guo was an ardent defender of TrumpLand on social media, became a member of Trump’s private club, Mar-a-Lago, and supported ventures involving Bannon.

When Bannon was arrested in 2020 on fraud charges, he was on Guo’s yacht.

Guo also sought investors in other businesses, and these efforts are the source of the Justice Department’s beef.

One of Guo’s operations was called the Himalayan Exchange. The DoJ states that the exchange offered “a purportedly stable coin called the Himalayan Dollar … and a trading coin called the Himalayan Coin” and that the Himalayan Exchange promised investors that if the value of the coin fell, it would cover any losses.

These promises were clearly a fiction, but Himalaya Exchange still managed to raise around $262 million from investors – many of whom were lured by misinformation on Guo’s social media accounts.

The Himalayan Exchange later carried out labyrinthine transactions that appear to have lined the pockets of Guo and his associates.

That’s why the DoJ on Wednesday charged Guo and friends with a dozen charges related to wire fraud, securities fraud, bank fraud and money laundering charges. The feds also revealed that they had seized about $634 million from bank accounts linked to Guo and friends.

“We allege that Guo was a serial fraudster, who collected more than $850 million by promising investors outsized returns on purported crypto, technology and luxury investment opportunities,” said Gurbir S. Grewal, director of the US Securities and Exchange Commission’s Division of Enforcement . .

“In reality, Guo exploited the hype and lure of crypto and other investments to sacrifice thousands and fund his and his family’s lavish lifestyle.”

Just how Guo will defend himself is anyone’s guess. In February, he filed for bankruptcy, claiming assets of less than $100,000 and debts somewhere between $100 million and $500 million. ®