Bitrabo Editorial
Yang Bin, once the second-richest individual in China, has been sentenced to six years in a Singaporean prison for orchestrating a Ponzi scheme that posed as a crypto investment venture.
The 61-year-old Chinese-Dutch citizen admitted to eight charges including involvement in a fraudulent scheme and was fined S$16,000 on August 26.
Under the alias A&A Blockchain Innovation, Yang’s fraudulent activities lured over 700 investors who collectively lost about S$1.1 million out of an alleged S$6.7 million invested between May 2021 and February 2022.
The company claimed to possess 300,000 cryptocurrency mining machines promising investors daily returns of 0.5%, but in reality, such machines were nonexistent. Yang used new investors’ money to pay returns to earlier investors, a classic characteristic of a Ponzi scheme.
History of Deceit
This is not Yang’s first encounter with legal troubles. He previously served an 18-year sentence in a Chinese jail starting from 2003 for tax evasion but was released in 2016.
His issues began in 2002 when he was tasked by North Korea to oversee economic development in the Sinŭiju Special Administrative Region, and shortly after, Chinese authorities placed him under house arrest for tax evasion.
Sophisticated Crypto Fraud With Fabricated Returns
Yang’s recent deception involved an app showing fake returns to investors, with a centralized system enabling the system manager to input bogus figures to display false returns of actual money.
Deputy public prosecutor Wong Shiau Yin revealed Yang’s substantial role in the scheme and lack of restitution for the victims. Authorities recovered S$100,000 from Yang’s residence, money he confessed belonged to the investors.
District Judge Brenda Chua sentenced Yang to six years in prison, considering his higher culpability compared to his co-accused. Yang’s lawyer managed to slightly reduce the sentence citing his client’s early admission of guilt and cooperation with the authorities.
The judge emphasized the significant sums involved, the long-term grievances of the victims, and the absence of any reimbursement to date.
Yang’s conviction serves as a stark reminder to investors to exercise caution and due diligence when investing in unregulated crypto schemes, underscoring the need to be vigilant in the rapidly evolving cryptocurrency industry.
Image source: Kohn, Kohn & Colapinto, chart from TradingView