A federal grand jury has charged a 41-year-old Contra Costa County man with running a $39 million Ponzi scheme that included more than 100 victims, federal prosecutors said.
The indictment charged Derek Vincent Chu, a resident of Alamo, with using several companies to raise $39 million between 2013 and 2020 by fraudulently soliciting investments in the purchase and resale of pro basketball tickets and luxury suites at arenas in Oakland, San Francisco and Los Angeles.
The indictment further alleges that Chu, who was taken into custody Tuesday, induced investors by making numerous materially false misrepresentations, including how the investor funds would be used, how investors would be repaid and whether the investments were secured by collateral.
According to the U.S. Attorney’s Office for the Northern District of California, Chu commingled the investors’ money between his own personal accounts and his companies’ accounts, which resulted in investor money being used to repay other, earlier investors, and for other unrelated expenses.
The indictment charges Chu with eight counts of wire fraud and three counts of money laundering.
Each wire fraud count has a maximum statutory sentence of 20 years in prison and a fine of $250,000. Each money-laundering count has a maximum statutory sentence of 10 years in prison and a fine of $250,000.
This is just a small taste of the greed that is so pervasive in our society. We, as a society, circling the drain of the dustbin of history have turned our backs on corruption and massive greed, be it personal, government, or corporate. My advice is, GET YOURS WHILE IT LASTS!
FIRST REPUBLIC BANK…KNOW THE TRUTH!!!
The Truth is…
Upper management suppresses internal audits for large deposits Re. money laundering. The upper management gives large loans to these types of depositors. Upper management then receives big monetary bonuses for selling large loans. Looks wonderful but you have to dive deeper to understand the greed-money-and putting balance of good depositors money at risk.
Upper management V.P./Legal Counsel was making $1,500,000+ PER YEAR.
Where are the Federal FDIC Audits to pick these illegal acts up, and confiscate their management’s assets for paying back the taxpayers who end up funding the wreck of a bank???
We should be irate and demand heads roll…
I expect it will get worse not better. Common sense for many and the government is out the window.
In recent weeks, the Biden administration has pointed to the “Economic Growth, Regulatory Relief, and Consumer Protection Act,” signed into law by former President Donald Trump in 2018, as a contributor to financial instability, since it allows banks to evade scrutiny from regulators and financial investors they would have previously faced.
The law passed Congress when Republicans were in the majority. While a few Democrats voted for the bill, most opposed the legislation, including both figures representing the center-left, like then-House Minority Leader Nancy Pelosi, and progressives like Sens. Bernie Sanders (I-VT) and Elizabeth Warren (D-MA).
The legislation weakened regulations applying to medium-sized banks that had been put in place by the Dodd-Frank Wall Street Reform and Consumer Protection Act, signed into law by then-President Barack Obama in 2010.
Dodd-Frank set up procedures for banks to be dismantled or liquidated in an orderly fashion to prevent taxpayers from needing to prop up institutions that were “too big to fail.” It also imposed limits on the types of products that banks can invest in (mortgage investing contributed to the recession), and it created a consumer protection agency, the Consumer Financial Protection Bureau.
A study published by the Yale School of Management on March 27 found that weakened standards introduced by the 2018 law contributed to the failures at Silicon Valley Bank. Under the old rules, the bank would have triggered more scrutiny about its inability to meet its financial obligations before the situation had reached a moment of crisis. But under the new system, it evaded further investigation.
The truth is there are those that exist behind the scenes that manipulate and simulate EVERYTHING.
Sorry chief. The JP Morgan deal was brokered by reducing regulatory requirements to dangerous levels, way north of 16%. Can’t hang this one on Trump.
Further, the Yale endowment fund has been championing non-liquid investments for over ten years. Retail investors read that crap, believe it, and are the last ones out, if at all, when those portfolios hit the wall. Anyone with a FINRA license places zero credibility in anything Yale has to say about finance.
Ancient Rome during its height of decline and fall was only a few miles across in size. The upper class was still banqueting and partying as the capital was being actively sacked by the Visigoths on the other side of the city. Partying until the last gasp of a great civilization. I think everyone knew the end was coming, it just couldn’t sustain itself. Quick get me a mirror so I can see our society collapsing around me. How long will China be the next number one before that falls apart? ENTROPY!
But looters, rioters and shoplifters go free with no consequences?
But do they go free with no consequences? Cause I see them being arrrested…
These are petty crimes, you can’t put them in jail for ever for petty theft
Petty crimes? Then why are businesses leaving SF by droves? Every convict serving a long sentence started off doing the petty crimes you speak of.
I don’t know but every time I started arguing with the parakeet I always lost.
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Some financial crimes should be subject to the death penalty and executed.
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But in CA, you voters installed Newsom – a spineless worm who is not concerned about justice or the victims.