Companies Tied to Chinese Exile Guo Wengui to Pay $539 Million to Settle SEC Action
The Securities and Exchange Commission on Monday charged
three media companies linked to wealthy Chinese exile Guo Wengui with
conducting illegal securities offerings.
The companies — New York City-based GTV Media Group and
Saraca Media Group as well as Phoenix, Arizona-based Voice of Guo Media —
agreed to settle for more than $539 million, according to the SEC.
The SEC charged GTV, Saraca and Voice of Guo with conducting
an illegal unregistered offering of GTV’s common stock. GTV and Saraca were
also charged with an illegal unregistered offering of a digital asset security
called G-Coins or G-Dollars.
The companies raised $487 million from more than 5,000
investors from the two securities offerings, according to the SEC.
GTV Media also reportedly has links to former White House
chief strategist Steve Bannon. The Wall Street Journal reported last year that
the SEC was looking into fundraising tactics by the company and noted at the
time that Bannon was a company director.
Bannon and Guo have been close for years. The former advisor
to President Donald Trump was arrested on Guo’s yacht and was charged with
defrauding hundreds of thousands of donors through his “We Build the Wall”
fundraising campaign. Bannon pleaded not guilty and was later pardoned by
Trump.
The SEC press release does not mention Guo or Bannon by
name.
Guo, his associates and some of the same companies were sued
by investors in a class-action lawsuit earlier this year for allegedly breaking
securities laws. Bannon is not mentioned in the lawsuit.
As for the settlement with the SEC, the Guo-linked companies
did not admit or deny any of the commission’s findings. Instead, the SEC says
the businesses agreed to a detailed settlement.
“GTV and Saraca agreed to a cease-and-desist order, to pay
disgorgement of over $434 million plus prejudgment interest of approximately
$16 million on a joint and several basis, and to each pay a civil penalty of
$15 million,” according to the SEC’s press release.
“Voice of Guo agreed to a cease-and-desist order, to pay
disgorgement of more than $52 million plus prejudgment interest of nearly $2
million, and to pay a civil penalty of $5 million,” the SEC release said. “The
order establishes a Fair Fund to return monies to injured investors.”
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