Chip Somodevilla
The U.S. Securities and Exchange Commission filed a lawsuit against QZ Asset Management, also called Qianze Asset Management, its holding company QZ Global, and the CEO of both entities, the regulator said on Tuesday.
The SEC alleges that the two entities and Blake Yeung Pu Lei, who also went by the name Yang Pulei, lied about the safety of clients’ investments, their relationships with some well-known banks and law firms, and a prospective public stock offering.
The complaint said QZ Asset and Yeung defrauded hundreds of individuals out of at least $6M. The firm falsely claimed it would use proprietary AI-based technology to help generate extraordinary weekly returns while promising “100%” protection for client funds, and that well-known and reputable financial and legal firms were providing services to the company, the SEC alleged.
Also in the complaint are allegations that the company falsely claimed that QZ Global had applied to have its common stock listed on the Nasdaq Global Select Market and reported positive communications with the SEC staff in that regard.
Eventually, the defendants allegedly stopped communicating with clients. In addition, QZ Asset’s website, used by clients to access their funds, was taken down, the SEC’s complaint said.
“We will continue to hold accountable those who deceive investors, including by misusing the SEC’s name and processes to provide an air of legitimacy to their fraudulent endeavors,” said Jason J. Burt, regional director of the SEC’s Denver Regional Office.
