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Five B.C. residents allegedly involved in US$15 million pyramid Ponzi scheme

Vancouver (May 28, 2020) – The British Columbia Securities Commission (BCSC) accused five B.C. residents of helping to promote a U.S. based Ponzi and pyramid scheme in connection with fake gold mining operations. Monita Hung Mui Chan, Sabrina Ling Huei Wei, Justin Colin Villarin, Marie Joy Vincent, and James Bernard Law were allegedly involved in a scheme that raised about US$15 million from more than 1,400 investors by either committing fraud themselves or making statements that they knew were misrepresentations. The commission will schedule a hearing date in July 2020.

The BCSC announced a hearing regarding the involvement of five B.C. residents in promoting a US$15 million US-based Ponzi and pyramid scheme. The commission accused Monita Hung Mui Chan, Sabrina Ling Huei Wei, Justin Colin Villarin, Marie Joy Vincent, and James Bernard Law of either committing fraud themselves or made statements that they knew, or reasonably ought to have known, were misrepresentations.

The US-based gold mining pyramid Ponzi scheme

2014 and 2015 Daniel Rojo Fernandes Filho, a Brazilian national who was living in Florida, was the mastermind of an investment scheme that promised investors extraordinarily high, no-risk returns. The investors were told that they were buying membership units in Massachusetts-based DFRF Enterprises LLC and Florida-based DFRF Enterprises, LLC.

The entities were supposed to entail lucrative gold mining operations. In reality, there were no gold reserves and in the manner of a classical Ponzi scheme, the investors’ funds were their only source of money. Consequently, more than 1,400 investors from around the world lost about US$15 million in the scheme.

2019, U.S. federal courts ruled that Filho and several others committed fraud. The courts ordered them to pay millions in sanctions, interest, and civil penalties.

Read more: Securities panel finds two B.C. men committed fraud through Ponzi scheme

Five B.C. residents allegedly involved

The BCSC alleged in their press release that the five B.C. residents promoted Filho’s Fraud and sold US$1,152,000 and CAD$2,000 worth of membership units in DFRF to 137 investors. Furthermore, the Commission believes that they appeared in promotional videos with Filho, organized, hosted or presented at private and public meetings for investors in the greater Vancouver area, distributed application forms and payment instructions to investors, accepted completed applications, and payments from investors, besides soliciting investors.

According to the BCSC, the investors lost all of their money without receiving any monthly returns. Subsequently, the Commission concluded that ‘the B.C. residents either committed fraud themselves or made statements that they knew, or reasonably ought to have known, were misrepresentations.’

Additionally, the BCSC believes that Wei committed a separate fraud. She is accused of diverting $90,000 worth of investor funds that were intended for DFRF to an account she controlled, and then used that money for her own benefit.

Read more: BCSC warns investors against pyramid scheme type ‘split games’

The BCSC said that it is seeking reciprocal orders against Filho and others based on the U.S court rulings that they committed securities fraud. The BCSC’s allegations have not been proven. The commission will schedule a hearing date in July 2020.