{"id":10896,"date":"2009-04-08T22:30:35","date_gmt":"2009-04-09T03:30:35","guid":{"rendered":"http:\/\/blog.jackjia.com\/?p=10896"},"modified":"2009-04-09T23:29:36","modified_gmt":"2009-04-10T04:29:36","slug":"20090408%e3%80%8a%e7%8e%af%e7%90%83%e9%82%ae%e6%8a%a5%e3%80%8b%e6%8a%a5%e9%81%93%e5%94%90%e7%82%9c%e8%87%bb%e4%ba%8b%e4%bb%b6","status":"publish","type":"post","link":"https:\/\/blog.jackjia.com\/?p=10896","title":{"rendered":"20090408\/\u73af\u7403\u90ae\u62a5\uff1a\u201c\u534e\u4eba\u5df4\u83f2\u7279\u201d\u58f0\u8a89\u6bc1\u4e8e\u516c\u5f00\u6f14\u793a"},"content":{"rendered":"

Meeting undid ‘Chinese Warren Buffett’<\/strong><\/p>\n

When Weizhen Tang could not show investors how he achieved reported results, they went to regulators <\/p>\n

PAUL WALDIE <\/p>\n

Globe and Mail Update<\/p>\n

April 8, 2009 at 7:37 AM EDT<\/p>\n

For years, Weizhen Tang was considered an investment guru in much of the Chinese community in North America. He called himself a “Chinese Warren Buffett” who could generate a 1-per-cent weekly return.<\/p>\n

But Mr. Tang’s reputation was dealt a stunning setback during the week of Jan. 26, 2009, according to documents filed in court this week where he’s facing allegations of fraud. That was when he held a public demonstration of his investment strategy in his Toronto office and couldn’t match the reported results of his funds.<\/p>\n

“Unfortunately the public demo failed,” Mr. Tang wrote in an e-mail to investors a few days after the event. “I apologize. I don’t want to find any excuses. I need more hard work.” <\/p>\n

He added that there wasn’t enough cash to meet the redemption demands that had come in since the meeting and he told investors to wait six months. <\/p>\n

Mr. Tang’s investors struck back. In the weeks to follow, they organized themselves into a committee, filed a lawsuit, launched their own investigation and went to regulators in Canada and the United States, court filings show. <\/p>\n

The Ontario Securities Commission shut down Mr. Tang’s Canadian operation, Oversea Chinese Fund, on March 17 and started an investigation into allegations of fraud. This week the U.S. Securities and Exchange Commission filed fraud charges against Mr. Tang in Dallas, alleging his fund was a Ponzi scheme. The SEC also froze the assets in his U.S. fund, WinWin Capital Management. <\/p>\n

Mr. Tang has acknowledged in e-mails to investors that he lost money investing, but he has insisted he didn’t take any money for himself. His lawyer has said Mr. Tang is co-operating with regulators. None of the allegations have been proved in court.<\/p>\n

Documents filed in court detail Mr. Tang’s rise to prominence and show his many attempts to encourage investors to stick with him despite the allegations. <\/p>\n

Mr. Tang, 50, came to Canada from China in the early 1990s, according to his website. He earned a graduate degree in biotechnology from the University of Waterloo and worked at various research facilities before turning to investing in 1995.<\/p>\n

At first he handled investments for friends and relatives, the website said. In 2001, he created Oversea Chinese and expanded to the Dallas area in 2006 with the help of Jiehua Yu, a friend from the University of Waterloo, according to court filings. Ms. Yu had earned a graduate degree from Waterloo as well and worked with a Guelph, Ont.-based company before moving to the United States. According to court filings, she created WinWin Capital, co-owned by Mr. Tang. <\/p>\n

By 2009, Oversea Chinese and WinWin had attracted more than 200 investors who invested roughly $75-million (U.S.) in total, according to court filings. The minimum investment was $150,000 (Canadian) in Oversea Chinese and $250,000 (U.S.) in WinWin. Mr. Tang did not charge a fee on the first 6 per cent of profit, but he took a 25-per-cent cut of any additional profit, according to court filings. <\/p>\n

Mr. Tang concentrated on recent immigrants from China and he became a fixture in the community. He joined numerous organizations and donated money to various causes, including offering financial support for a group of pro-China demonstrators at a rally in Ottawa last year. <\/p>\n

According to e-mails filed in court, he had great hopes of “raising massive funds” by tapping into China’s new entrepreneurial spirit. He planned to use his own investment skill and “widespread propaganda” to create a giant fund, according to one e-mail, which mentioned a figure of $700-million. <\/p>\n

But after the failed demonstration, many investors turned on him. On Feb. 27, about 200 confronted him in Toronto. <\/p>\n

In an e-mail sent a few days later, Mr. Tang called the meeting “shocking, sad and painful” and outlined a plan to recoup the losses. He said in a later e-mail that he had received $1-million from a friend, turned it into $2-million in 12 days and used it to repay investors.<\/p>\n

“Please believe my trading ability,” he wrote. “Please give me time.” He acknowledged later to one investor that he had lost $15-million in 2006 and 2007, according to court filings. <\/p>\n

Just days before the OSC’s move, WinWin sent investors an e-mail outlining a plan to stay in operation. <\/p>\n

“It is inappropriate and unsafe to continue using the original Oversea Chinese Fund Trading account because the account can be frozen if government investigation is started,” said the e-mail dated March 14, 2009. “A new business entity, trust account and a new trading account should be formed in order to carry out this pay-back plan properly.” <\/p>\n

Even after the OSC shut down Oversea Chinese, Mr. Tang continued to beg investors to stick with him. “Even if I have to go to jail,” he wrote in one e-mail, “I still hope that I can go after I have repaid all of you.”<\/p>\n

Investors like Daniel Xu, a business professor at the University of Western Ontario, are hoping to get some of their money back. “I think I lost a lot of money,” Mr. Xu said in a recent interview. “It’s terrible.”<\/p>\n

http:\/\/www.theglobeandmail.com\/servlet\/story\/RTGAM.20090408.wrtang0408\/BNStory\/Business\/<\/p>\n","protected":false},"excerpt":{"rendered":"

Meeting undid ‘Chinese Warren Buffett’ When Weizhen Tang could not show investors how he achieved reported results, they went to regulator…
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