SEC Charges Co-Founder of IIG With Ponzi Scheme Fraud

The US Securities and Exchange Commission (SEC) accused David Hu, co-founder and chief investment officer at International Investment Group LLC (IIG), of running a Ponzi scheme fraud.

20 July, 2020 | AtoZ Markets – David Hu is 62 years old and lives in West Orange, NJ. He is the Chief Investment Officer and co-founder of the International Investment Group (IIG). He is also a former registered investment advisor. Before joining IIG, he was a Managing Director and Head Trader at Smith Barney and Nomura Securities International, and a Senior LDC Bond Trader at American Express Bank Limited.

SEC Accused IIG Co-Founder of Defrauding Investors

US SEC charged David Hu for running a Ponzi scheme fraud by mismarking, making up investments. The commission also accused David Hu of violating the federal securities law, seeking permanent injunctive relief, disgorgement, and civil punishment.

According to the complaint, since October 2013, David Hu arranged and managed fraud with IIG's investment advisor clients. Hu significantly overvalued the assets of IIG's major hedge funds, which resulted in the fund paying IIG high fees. Sanjay Wadhwa, Senior Associate Director of the SEC's New York Regional Office said:

"As alleged, Hu's deception caused substantial losses to a retail mutual fund, and other funds IIG advised. The SEC also remains committed to holding accountable individual wrongdoers who seek to take advantage of investors for personal gain, including when they employ elaborate means to cover up their fraud."

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David Hu tricked an IIG customer with a false document of the defaulted loan. The proceeds used to create a new loan. Last year, the US SEC also accused IIG with securities fraud. International Investment engaged in inflating the value of troubled loans and replacing defaulted loans with bogus credit assets.

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