P2P lender founder receives 16.5 years for NT$8.3 billion fraud

Taipei, Aug. 1 (CNA) Taipei District Court on Thursday handed down jail sentences of 16 years, six months and 12 years, two months to Tseng Yao-feng (曾耀鋒) and Chang Shu-fen (張淑芬), founders of the lending platform im.B, for money laundering and illegally accepting deposits.

The other 29 defendants in the case were found guilty of similar offences and received jail sentences ranging from one to eight years, according to a news statement released by the court.

Tseng and Chang set up im.B in 2015, claiming to be a legal peer-to-peer (P2P) lending platform and promising investors annual returns of 6-13 percent.

However, the company set up fake accounts to feign lending activities, with the platform initially covering interest payments to lenders using money taken from new users, before stopping entirely in April 2023, according to prosecutors, who indicted the 31 individuals in August that year.

The platform raked in a total of NT$8.34 billion (US$254.64 million) between June 2016 and May 2023, the court said.

Tseng and Chang's illicit gains topped NT$7.7 billion, with NT$7.1 billion remaining after paying principal, interest, sales performance bonuses and compensation to some of the victims, the statement said.

However, as Tseng refused to disclose the whereabouts of the remaining NT$7.1 billion throughout the trial, his sincerity in wanting to reimburse victims' losses is questionable, the court said.

In addition to their prison sentences, Tseng and Chang were fined NT$2.5 million and NT$1.5 million, respectively. The court also ordered the NT$7.1 billion be confiscated.

In the same case, former Executive Yuan advisor Chen Chen-kun (陳振坤) was found guilty of money laundering, after helping Tseng to hide luxury items and sell a property in Taoyuan.

Chen received a jail term of one year, with a fine of NT$1.5 million. As he plead guilty, the sentence was suspended for four years, though he was also ordered to pay NT$1 million to the treasury and has NT$12 million in criminal proceeds seized.

The verdict can be appealed.