Owner of Ju Ding Ponzi scheme arrested
When BehindMLM reviewed Ju Ding back in late 2013, we were unable to establish who was running the scheme.
Links between Ju Ding and Phil Ming Xu’s WCM777 were observed, but nothing concrete on who explicitly was behind Ju Ding.
Turns out Wenxing Huang (also known as “Di Peng” and “Fatty”), a resident of San Gabriel, California, was behind the scheme.
Yesterday FBI agents arrested Huang, who is now facing charges of wire fraud and money laundering.
For those unfamiliar with the scheme, Ju Ding offered affiliates passive ROIs of up to $20 a day. Through a binary compensation structure, Ju Ding affiliates were also paid to recruit new investors into the scheme.
Huang operated Ju Ding, Inc., which solicited funds from investors with false promises that their money would be used to invest in and develop technology based on graphene, which is a layer of pure carbon that is only one atom thick.
But, according to the complaint, Ju Ding does not appear to have engaged in any business or to have sold any goods.
In typical MLM Ponzi fashion, Huang strung his victims along while he skimmed off the top for his own personal gain.
Huang used approximately half of the funds deposited with Ju Ding to purchase a $1.3 million home in Diamond Bar, luxury automobiles and jewelry.
Huang is charged with money laundering for allegedly using approximately $1.2 million in investor funds to purchase the Diamond Bar home, which has since been sold.
In total Huang and Ju Ding scammed $6.9 million from around 400 victims. The actual number may be higher once cash deposits made into the company are taken into account.
Of the six million taken in, Huang paid out $2.2 million to investors.
Minus the $1.2 million Huang spent on himself, the remaining $3,5 million
was sent off to China is currently unaccounted for.
“Mr. Huang misled hundreds of investors with get-rich-quick promises decorated with fancy cars and parties,” said United States Attorney Eileen M. Decker.
“Extravagant promises of instant wealth are almost assuredly frauds, and potential investors should be especially wary of lavish pitches such as those employed by Mr. Huang.”
Huang made his first appearance in court yesterday afternoon. The case was only just unsealed and as of yet Pacer’s database doesn’t appear to have updated.