The United States Securities and Exchange Commission (SEC) has accused a Chinese asset management company of falsely claiming to be listed, deceiving hundreds of victims, and fraudulently obtaining at least $6 million.
On Tuesday (August 27), the SEC announced charges against QZ Asset Management Limited, also known as Qianze Asset Management Limited, and its holding company QZ Global Limited based in South Dakota, as well as their co-CEO Yang Pulei, also known as Blake Yeung Pu Lei.
The SEC alleges that they misled clients and potential clients about the safety of investments, and lied about relationships with investment advisors, some well-known banks and law firms, and the initial public offering of the holding company.
According to the complaint, QZ Asset, QZ Global, and Yang Pulei defrauded hundreds of victims, totaling at least $6 million.
The complaint states that QZ Asset and Yang Pulei misrepresented that QZ Asset would use its proprietary AI technology to help with investments, claiming high weekly returns and promising “100%” protection of client funds, with reputable financial and legal firms serving the company.
The complaint also alleges that the defendants falsely claimed that QZ Global had applied to list its common stock on the Nasdaq market and that they were actively communicating with SEC staff. Additionally, QZ Global boasted about its SEC filings (later found to have significant deficiencies) to entice clients to invest with QZ Asset.
Following the global fraud scheme involving millions of dollars, the defendants ceased communication with clients, and the QZ Asset website used to access funds has been shut down.
Jason J. Burt, Regional Director of the SEC’s Denver office, stated, “We allege that the defendants engaged in blatant fraud, including misusing the SEC’s filing procedures to deceive individuals in the United States and around the world, these actions are reprehensible.”
“We will continue to hold accountable those who defraud investors, including misusing the SEC’s name and procedures to legitimize their fraudulent activities,” Burt added.
The SEC also alleges that the defendants violated anti-fraud provisions of federal securities laws and seeks to impose permanent injunctions, restitution of alleged ill-gotten gains, and civil penalties.
QZ claims to be a global financial company specializing in addressing challenges in managing digital assets on the blockchain. The company profile describes providing a robust platform for managing various digital assets, offering comprehensive services including fund investments, portfolio management, and asset custody.