Judge nixes bail for Chinese businessman in $1B fraud case

A New York federal judge says a self-exiled Chinese businessman charged in a $1 billion fraud case will remain behind bars after she rejected a proposed $25 million bail package

Exiled Chinese Businessman Fraud Arrest (Copyright 2021 The Associated Press. All rights reserved)

A self-exiled Chinese businessman charged in a $1 billion fraud case will remain behind bars after a federal judge rejected a proposed $25 million bail package Thursday, saying there was clear and convincing evidence he would remain an economic threat and a flight risk if he were freed.

Judge Analisa Torres said in a written order that she didn't trust that Guo Wengui would obey court orders if released, even with strict bail conditions including GPS monitoring and a 24-hour guard. She noted that he faces a maximum sentence of over 100 years in prison if convicted.

She said Guo has continued to promote fraudulent investment opportunities even after funds were seized from his businesses last year.

Guo, 54, was arrested last month on charges including wire and securities fraud. Prosecutors said he fleeced thousands of investors in too-good-to-be-true offerings that promised outsize profits for investors in his media company, GTV Media Group Inc., his so-called Himalaya Farm Alliance, G’CLUBS and the Himalaya Exchange.

He has pleaded not guilty.

Since September the U.S. government has seized approximately $634 million from 21 bank accounts associated with Guo, who is referred to in court documents by the name Ho Wan Kwok.

Guo has claimed he has only $10,000 in noncash assets, though prosecutors say he has control of a 50,000-square-foot mansion, a $3.5 million Ferrari, two $36,000 mattresses and a $37 million luxury yacht.

It was on Guo’s yacht that Steve Bannon, the former chief White House strategist under ex-President Donald Trump, was arrested in a criminal fraud case several years ago. Trump pardoned Bannon just before he left office in 2021.

Judge Torres noted in her order Thursday that Guo was accused of using proceeds from a five-year fraud scheme from 2018 through this March to buy extravagant goods and assets for himself and his family.

Torres said Guo accumulated a large online following in 2017 with claims against the Chinese Communist Party before founding a nonprofit a year later that drew even more followers. She cited evidence that he subsequently advertised fraudulent investment activities to his followers.

Guo was once thought to be among the richest people in China before he left that country in 2014 during a crackdown on corruption that ensnared individuals close to him, including a top intelligence official. Chinese authorities have accused Guo of rape, kidnapping, bribery and other offenses.

Guo has said those allegations are false and intended to punish him for publicly outing corruption in China and criticizing leading figures in the Communist Party.

Lawyers for Guo did not immediately respond to a request for comment Thursday. A spokesperson for prosecutors declined to comment.