City of Industry, CA – December 19, 2006 – Jian Zhuang of Japan has been permanently banned from the commodity futures and options markets following a settlement with the U.S. Commodity Futures Trading Commission (CFTC). The consent order, issued by Judge A. Howard Matz of the United States District Court for the Central District of California on November 30, 2006, resolves charges that Zhuang and Emerald Worldwide Holdings, Inc. engaged in a fraudulent scheme to solicit investments for illegal off-exchange foreign currency (forex) trading.
According to the CFTC’s complaint, filed May 10, 2004, Zhuang, along with Emerald and co-defendants Hao Jan Lu and City Trust and Investment Co. Inc., fraudulently solicited over $5 million from customers in Japan and China. The scheme involved offering investments to trade forex futures contracts in the United States without proper registration or adherence to regulations.
The CFTC alleged that promotional materials distributed by City Trust employees contained false statements about Emerald’s registration status and affiliations. Instead of trading customer funds as promised, Emerald and City Trust allegedly transferred the money to various bank accounts in the United States, Japan, China, and Hong Kong, benefiting themselves and related entities.
The court found Emerald and Zhuang liable on all counts in a summary judgment order on July 5, 2005. As part of the settlement, Emerald is required to pay $3,433,722.61 in restitution and a $9 million civil monetary penalty. Zhuang is jointly and severally liable for $2,264,879.94 in restitution and individually liable for a $250,000 civil monetary penalty. The consent order permanently prohibits both Emerald and Zhuang from engaging in any commodity-related activity, including trading and soliciting investments.
Additional disgorgement orders were issued against relief defendants Lynnwood Jen ($10,000), Esther Pranolo ($55,897.79), and ACE Capital Advisory Group, Inc. ($39,194.96). A default judgment was previously entered against ACE Emerald W. Holding, Inc., requiring the disgorgement of $1,299.80. The court will retain jurisdiction to approve a plan for distributing restitution to defrauded customers. The case remains pending against Hao Jan Lu.
Source: CFTC.gov
Related Federal Cases
- Amy Evangelista, Tax Fraud, California 2023 · Alaska
- Federal Regulators, Lifel, Securities Fraud, California 2020 · New York
- McKenzie Marie Earley, $10M Wire Fraud, C.D. California, 2023 · Alaska
- Bruce Choi, COVID-19 Relief Fraud, Los Angeles CA, 2023 · Pennsylvania
- Irina Segal, Medicare Fraud, Philadelphia PA, 2023 · California
