Sat, Oct 03, 2015 - Page 3 News List

Authorities foil financial scam

EXECUTIVES INDICTED:Kuanchou Asset Management Co officials have been charged with financial fraud and money laundering after they were arrested earlier this week

By Jason Pan  /  Staff reporter

Authorities in Kaohsiung have charged the principal figures of three companies who allegedly ran a financial scam in which they made NT$1.9 billion (US$57.3 million) in profit in just over a year by enticing people to invest money in a tie-in scheme involving the RCD Espanyol soccer club, which is a renowned team in Spain’s top flight, La Liga.

Public prosecutors yesterday indicted top executives of Kuanchou Asset Management Co, including owner Chen Hsiu-an (陳修安), 37, sales manager Chen Po-yen (陳柏諺), 47, and several business associates for financial fraud, money laundering and other charges related to violations of the Banking Act (銀行法), after arresting them earlier this week.

Kaohsiung District Prosecutors’ Office officials said Kuanchou Co and its associates lured people with the promise of investing in shares of Power 8, sponsor of Espanyol which has naming rights on the team's kit and other endorsements, while some investors were offered business-class flights and tickets to watch Espanyol play against other La Liga teams.

The principals of Kuanchou Co claimed they had a business tie-in with Power 8, a gaming company registered in Costa Rica and with an office in Spain.

Kuanchou Co promotional brochures prominently featured the Espanyol club, its players and their stadium, which is based in Barcelona.

It has been reported that the operators of Kuanchou Co’s alleged scam also offered investments in Macau’s casinos and gold trading firms, promising profitable returns.

Officials said there were more than 400 Taiwanese who put up the money, as the operators of the scam made a profit of about NT$1.9 billion in just over a year, with many investing US$50,000 with the promise of being able to watch Lionel Messi, Neymar, Luis Suarez, Cristinao Ronaldo and other stars in action in matches against Espanyol.

Authorities said the scam was created in collusion with a man called “Phillipe,” who police said was an employee at Power 8, and that “Philippe” collaborated with a group of companies in Kaohsiung, headed by Kuanchou Co.

They said the man in question could be “Philippe Capelle,” who is purportedly a manager at Power 8, which besides being sponsors of Espanyol also have deals with English soccer teams Everton and Fulham.

According to international media reports, the scam has been exposed as a devious financial operation used to swindle money and has been described as a “US$250 million ponzi fraud, selling shares to poorly protected investors in Taiwan, India, Hong Kong, Singapore and China.”

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