152 indicted for illegally selling offshore funds

Taipei, July 18 (CNA) The head of a Taiwan-based investment company surnamed Tseng (曾), along with 151 others, was indicted Thursday for illegally selling offshore funds, violating banking laws and other offenses, Taipei District Prosecutors Office said in a press statement.

Tseng recruited over 100 managers and sales staff in Taiwan to illegally sell offshore funds, amassing over NT$13 billion (US$398 million) from more than 800 victims, prosecutors said.

An investigation conducted by prosecutors revealed that on May 25, 2010, Tseng established the company and recruited 11 individuals to serve as general managers, administrative vice presidents, deputy general managers, directors and supervisors.

He further recruited 140 individuals as managers, deputy managers, assistant managers, and sales personnel.

Prosecutors found that Tseng and his associates promoted, solicited and sold offshore financial products without approval from the Financial Supervisory Commission (FSC) in Taiwan.

They guaranteed annual investment returns of 8 percent to 15 percent, claiming minimal or no risk of loss, and promised the return of principal upon maturity with additional agreed returns, thus attracting investors.

Company sales personnel took investors to Hong Kong to open accounts, prosecutors said.

Following instructions from sales personnel, those individuals then transferred funds for the purchased products by exchanging foreign currency and remitting it to designated banks to buy offshore financial products.

Subsequently, victims would verify their investment performance through account statements provided by the company or by logging into a website, while the company would take commissions and referral fees from these transactions.

This continued until investors found in February 2023 they were unable to redeem their invested principal or interest, resulting in the total loss of their investments.

Prosecutors' statistics show the company defrauded 804 individuals with total investments exceeding NT$13 billion.

The Taipei District Prosecutors Office indicted Tseng and 151 others for violations of the Organized Crime Prevention Act, illegal sale of offshore funds under the Securities Investment Trust and Consulting Act, and illegal banking operations under the Banking Act.

Three other defendants have absconded and been placed on law enforcement's wanted list, while a request has been filed with the court to confiscate approximately NT$1.3 billion in assets.