Steve Bannon Associate Arrested In Billion Dollar Fraud Scheme

In a stunning development, a Chinese billionaire and associate of former White House strategist Steve Bannon has been arrested in connection...

In a stunning development, a Chinese billionaire and associate of former White House strategist Steve Bannon has been arrested in connection with a $1 billion fraud conspiracy, according to officials.

The billionaire, Guo Wengui, who is also known as Miles Kwok, was taken into custody by federal authorities in New York on Monday along with his business associate, Danhua Capital CEO and managing partner, Zhou Yuan.

According to the criminal complaint filed by the US Attorney's Office for the Southern District of New York, Guo and Zhou were part of a scheme to defraud investors in the United States by falsely inflating the value of their companies.

The complaint alleges that Guo and Zhou falsely claimed that their companies, which included a media company, a social media platform, and an e-commerce site, had reached valuations of up to $1.5 billion. In reality, the companies were worth far less, and the defendants allegedly used the inflated valuations to secure additional investment funds.

The complaint also alleges that Guo and Zhou misrepresented the backgrounds and qualifications of key executives at their companies, and engaged in a pattern of self-dealing and kickbacks.

Guo, who has been living in the United States since 2015 after fleeing China, has been a vocal critic of the Chinese Communist Party and has been accused by the Chinese government of various crimes, including bribery and fraud.

The arrest of Guo and Zhou is a major blow to Bannon, who has been a close associate of Guo's and has previously referred to him as a "hero" for his efforts to expose corruption in China. Bannon was also arrested in August 2020 on charges of defrauding donors to a crowdfunding campaign to build a wall along the US-Mexico border, but those charges were later dropped.

The investigation into Guo and Zhou's alleged fraud scheme is ongoing, and the defendants face multiple charges, including wire fraud, conspiracy to commit wire fraud, and money laundering. If convicted, they could face significant prison time and fines.

The arrest of Guo and Zhou is a reminder of the risks associated with investing in startups and emerging companies, particularly those with ties to foreign governments or individuals with controversial backgrounds. As the US continues to grapple with the fallout from the COVID-19 pandemic, investors must remain vigilant and exercise caution when evaluating potential investments.