SEC Charges California Couple with Running $150 Million Ponzi Scheme
The Securities and Exchange Commission has charged Yin Nan (Michael) Wang, Wendy Ko, and their company Velocity Investment Group (“Velocity”) of Pasadena, California with securities fraud and have obtained an emergency asset freeze.
According to the SEC’s complaint, Wang and Ko have raised over $150 million from approximately 2,000 investors since 2005. The investors purchased promissory notes issued by Velocity. According to the complaint, Velocity manages a series of funds called the Bio Profit Series that purport to make real estate loans in California.
The SEC alleges that Wang directed the falsification of financial records, and that Wang and Ko used transactions between the Bio Profit Series funds and another company, Rockwell Realty Management, to conceal the fraud. The SEC alleges that the defendants used later investors’ money to make Ponzi-like payments to the earlier investors.
The hearing on the SEC’s motion for a preliminary injunction is set for December 9.