The Largest Securities Fraud in California History

Securities Fraud Charges Filed Against Walter and Kelly Ng

Zintro reports Department of Justice felony charges have been filed against Walter and Kelly Ng, who are believed to have stolen approximately $700 million from investors. Fraud Solutions principal Dan Draz commented on the case:

Although only certain cases garner extensive media coverage, corporate fraud is prevalent in the U.S. Daniel W. Draz, a Certified Fraud Examiner and founder of Fraud Solutions, is an international fraud consultant. “Every state in the country, and the federal government, has investigators solely dedicated to securities and fraud related issues,” explains Draz. “There are several private regulatory entities that have key roles in securities and fraud oversight. The Bureau typically averages over 500 major corporate fraud cases a year, despite regulatory acts designed to protect the public, with some exceeding a billion dollars in losses. And some of those statistics are comprised of sophisticated securities related fraud cases like the Ng case.”

The Ng’s will be arraigned November 6. Says Draz, “While all persons are presumed innocent until proven guilty, the mere fact that the government was able to bring these charges, and the depth and number of charges, suggests that they have a significant amount of evidence and victims with which to proceed with criminal charges. The multitude of charges ensures that there are likely going to be convictions on at least a portion of the ones they brought against the defendants for their alleged securities fraud activities.”

Many of the victims lost hundreds of thousands of dollars. The SEC has filed a civil suit against the Ngs for accusing them of lying to investors and using new asset to fund a collapsing fund. According to Draz, “In a civil case, plaintiffs only have to prove ‘preponderance of the evidence’- which means that the standard for proving that they were defrauded is only 51%, significantly less than the ‘beyond a reasonable doubt’ standard used in criminal cases. The plaintiffs ‘will go to school’ during the criminal case learning about the Ng’s alleged financial improprieties and gathering information which can then be used during civil trial. If the evidence that the government has is substantial, the plaintiffs have an excellent chance of winning their civil cases, yet a small chance of actually recovering a significant portion of their lost financial assets.”

Visit Zintro to find out more about the Department of Justice securities fraud case against the Ngs.