Guo Wengui found guilty of fraud, followers' funds become "personal piggy banks"

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On July 16, 2024, Eastern Time, Guo Wengui (also known as Miles Guo), an Interpol "red notice" who had fled to the United States for many years, was found guilty of defrauding thousands of people of more than $1 billion in a Manhattan court in New York.

In a statement after the verdict, prosecutor Damian Williams said that Guo Wengui was found guilty of 9 of the 12 counts of fraud and money laundering involved. The judge will sentence him on November 19 this year, and Guo Wengui may face decades in prison.

The verdict wrote that Guo Wengui shamelessly implemented several interrelated fraud schemes, all of which were designed to squeeze their hard-earned money from loyal followers to fund his luxurious life in exile.

According to CNN, after the verdict was read, Guo Wengui smiled at his legal team and dozens of supporters in court, then turned around to hug lawyer Sabrina Shroff and shook hands with other members of the defense team.

Public information and reports show that Guo Wengui, 57, was the actual controller of Henan Yuda Investment Co., Ltd. and Beijing Pangushi Investment Co., Ltd. On November 3, 2014, Guo Wengui publicly exposed the suspected insider trading of Li You, CEO of Peking University Founder, and others through Zhengquan Holdings, and left China that year. He then created a so-called insider persona through online live broadcasts and other activities, and gained a large number of overseas followers.

The US investigation showed that Guo Wengui raised more than $1 billion from his online fans between 2018 and 2023, publicly stating that it was used to invest in his business and cryptocurrency plans, but in fact it was used as a "personal piggy bank."

In 2021, three companies associated with Guo Wengui, including GTV, paid $539 million to resolve the U.S. Securities and Exchange Commission (SEC)'s allegations of illegal stock issuance against the three companies. In addition, the SEC also accused GTV and Saraca of illegal unregistered digital asset securities issuance.

According to prosecutors, Guo Wengui's other scams involved a private members-only club (with a minimum membership threshold of $10,000), as well as cryptocurrency platforms. In addition, the US government accused him of misappropriating investor funds to buy luxury goods, including a red Lamborghini, a $4 million Ferrari and a $26 million New Jersey mansion.

Guo Wengui also maintained a close relationship with Steve Bannon, a senior strategic adviser to former US President Trump. Bannon arrived at a federal prison in Connecticut on July 1 after serving a four-month sentence for contempt of Congress.