Benjamin Wey

Benjamin Wey

Benjamin Wey
Born Tianjin, China
Other names Benjamin Tianbing Wei, 魏天冰
Citizenship US
Alma mater
Occupation Businessman, financier

Benjamin Wey (Benjamin Tianbing Wei, Chinese: 魏天冰; pinyin: Wèi Tiānbīng)[1][2] is a Chinese-born American Wall Street financier and CEO of New York Global Group (NYGG).[3][4] He began his financial career as an investment advisor and broker in Oklahoma in the late 1990s. Wey and NYGG were among the most active "facilitators and promoters" of reverse takeovers that allowed small Chinese companies to raise capital on U.S. markets, until reverse takeovers became the subject of a U.S. Securities and Exchange Commission investigation in 2011.[2][5]

In September 2015, Wey was indicted by the United States Department of Justice on charges of securities fraud, stock manipulation, money laundering, and wire fraud for his role in an alleged fraudulent scheme to profit from undisclosed, controlling ownership interests in several companies in the United States, including 6D Global Technologies Inc." [6] [7] He is also facing a defamation suit stemming from his attacks on a Financial Industry Regulatory Authority (FINRA) regulator and Georgetown University law professor in his internet magazine The Blot. According Bloomberg Businessweek, he has also used the publication to defame investigative journalists.[8]

Early life and education

Wey was born in Tianjin, China. His father was a diplomat with the Ministry of Foreign Affairs and his mother an electrical engineer. He went to the United States on a full scholarship (according to a 2010 interview)[9] to study finance at Oklahoma Baptist University, graduating in 1992. While still at college, he had his own trade business which he continued after his graduation while at the same time studying at the University of Central Oklahoma for a master's degree in Business Administration which he received in 1999.[10] According to his official biography, he later received a second MBA from Columbia Business School.[3]

Career

He began his financial career in Oklahoma where he worked as an investment advisor and broker. In 2000, he became the CEO of the Oklahoma-based Benchmark Global Capital Group. In 2002 Wey was fined $5,000 and suspended by the U.S. National Association of Securities Dealers, now FINRA, for "maintaining accounts" at his brokerage firm without informing the firm in writing. The Oklahoma Department of Securities censured Way and banned him from operating in the state. They claimed that he had advised a retired 68-year-old woman to invest her entire life savings in the Nasdaq listed stock of Pharmaprint, a "risky penny stock," without disclosing that he was a paid consultant to the company. Without admitting or denying the allegations, Wey agreed to cease carrying out all brokerage and investment advisory business in the state.[2][11]

Wey transferred his base of operations to New York City where he is the CEO of New York Global Group, a U.S. and Beijing-based financial firm that had managed 200 China-related transactions as of 2011, and was described by the Financial Times as a "key 'bridge' between fast-growing Chinese companies and US capital markets."[2] The firm claims access to approximately $1 billion in capital.[3] The firm is noted for reverse mergers, in which midsize Chinese companies are taken public in the United States by acquiring the corporate shells of U.S, companies that are no longer in operation and whose shares had previously been listed in an American equities market.[12] The firm reported in 2009 that 15% of Chinese companies listed on the NASDAQ stock exchange were its clients.[5] In 2011, the Swedish Financial Supervisory Authority found that the NYGG's company name was being fraudulently used in a case of corporate identity theft and described the identity theft as an advance fee fraud scheme.[13] In May 2012, the United States Securities and Exchange Commission put out a similar alert warning the general public of concerning the fraudulent company maliciously using NYGG's name.[14]

By 2012, regulators had stepped up action against certain Chinese reverse-takeover stocks, but according to the Financial Times had been hamstrung by lack of cooperation from Chinese regulators.[15] Among such stocks were Bodisen Biotech, which was brought into the equity markets by NYGG and was delisted from the American Stock Exchange in 2007.[16] The exchange cited "internal control weaknesses related to its accounting and financial reporting obligations" and "incomplete, inaccurate and/or misleading information related to its relationship with, and payments to, a consultancy firm and its affiliates" [17] Barron's reported in 2011 that "much of the universe of Chinese reverse mergers has become a swamp of revenue disappointments, earnings restatements and some outright frauds," and that Bodisen was "one early sinkhole."[5]

In December 2010, the NASDAQ stock exchange delisted CleanTech Innovations Inc., a wind-tower manufacturer, citing its association with Wey, whom the exchange's senior vice president called "notorious" because of his past stock promotions. The NASDAQ delisting prompted a lawsuit in 2011 from CleanTech, which was represented by former U.S. senator Arlen Specter with Wey as a "consultant".[18] The suit (later dismissed because the SEC had not yet rendered its own decision in the case) had accused NASDAQ of a "racially profiling set of procedures" that targeted the Chinese.[19][20][20][21] Specifically, Cleantech's amended complaint alleged that "overt and systematic racially-motivated discriminatory acts" were the basis of Cleantech's delisting.[19] In July 2013 in what Forbes called "a landmark decision", the U.S. Securities and Exchange Commission reversed NASDAQ's delisting of the company. The SEC specifically concluded that "[T]he record does not show that the specific grounds on which Nasdaq based its delisting decision exist in fact."[20]

Wey solicits media attention and bills himself as an expert in U.S.-China trade relations.[5] He has appeared on various TV media outlets including The Wall Street Journal TV,[22] Fox Business News and TheStreetTV.[23] In a Columbia Journalism Review column in 2010, financial journalist Felix Salmon cited Wey's pursuit of publicity as an example of persons receiving media placement because of the hiring of public relations representatives and not their expertise.[23] Wey also publishes and writes extensively for the digital publication TheBlot (launched in 2013), where he describes himself as an "investigative reporter."[24][25] As of 2016, he is facing a defamation suit stemming from his attacks on a FINRA regulator and Georgetown University law professor in the magazine.[26] According Bloomberg Businessweek and the Columbia Journalism Review, he has also used the publication to defame and threaten investigative journalists.[8][27]

In July 2014, Wey was sued by a former employee, who alleged that he was wrongfully fired after he reported that another employee was "repeatedly and consistently” the subject of "disgusting and degrading quid pro quo sexual harassment." Hannah Bouveng, the employee who had been the subject of the alleged harassment had filed an $850 million lawsuit against Wey's company earlier that month. Law360 quoted Wey as saying that the lawsuits were "frivolous" and "an extortion attempt."[24] The sexual harassment trial opened on June 15, 2015 at the Manhattan Federal District Court. It closed on June 29, 2015 with the jury awarding Bouveng $18 million—$2 million in compensatory damages and $16 million in punitive damages, primarily for defamation by Wey, NYGG, and its subsidiary FNL Media who publish TheBlot. While the allegations of assault and battery were rejected, the jurors found in Bouveng's favour on the charges of sexual harassment, retaliation and defamation.[28][29] In April 2016, the award was reduced to $5.6 million by a Federal District Court judge.[30]

Wey's Wall Street offices had been searched by the Federal Bureau of Investigation in January 2012 as part of a continuing investigation. According to David Barboza writing in the New York Times, it was the "strongest indication yet" that US federal investigators may have started to probe the advisers and promoters involved in "so-called backdoor listings of Chinese companies."[12][31][32] In September 2015, Wey was indicted by a U.S. federal grand jury on eight counts of conspiracy, securities and wire fraud, and money laundering in connection with his reverse merger scheme and involving the companies SmartHeat, Deer Consumer Products, and CleanTech Innovations. In addition to the criminal charges, the U.S. Securities and Exchange Commission filed a parallel civil lawsuit against Wey which also included as defendants Wey's wife, his sister, and two of his attorneys, all of whom were alleged by SEC complaint to have committed "violations or the aiding and abetting of violations of the antifraud provisions and the disclosure and reporting provisions of the federal securities laws".[6][33][34]

Wey is one of at least two hundred Americans found using offshore accounts by the Panama Papers. He is accused of using the offshore accounts to cloak transactions between Chinese operating companies and American shell companies.[35][36]

References

  1. ↑ FINRA broker check, Financial Industry Regulatory Authority. Retrieved 20 July 2014.
  2. 1 2 3 4 Anderlini, Jamil (26 July 2011). "Made in China, undone in America". Financial Times. Retrieved 11 September 2014.
  3. 1 2 3 "New York Global Group CEO and China Expert Benjamin Wey Presents at the Carnegie Mellon University US - China Summit -Center for Innovation and Entrepreneurship - Carnegie Mellon University". cmu.edu. Retrieved 2014-04-28. (This CMU story is attributed to "New York Global Group CEO and China Expert Benjamin Wey Presents at the Carnegie Mellon University US - China Summit", Wall Street Journal, April 29, 2013; attributed to PR Newswire, and labelled "The Wall Street Journal news department was not involved in the creation of this content."). Retrieved 11 September 2014.
  4. ↑ CEO of New York Global Group. About, nyggroup.com. Retrieved 11 September 2014.
  5. 1 2 3 4 Norton, Leslie P. (18 June 2011). "The Curious Case of New York Global - Barron's". Barron's. Dow Jones & Co. Retrieved 31 August 2014.
  6. 1 2 Barbash, Fred (11 September 2015). "Wall Street financier Benjamin Wey charged with securities fraud, money laundering". Washington Post. Retrieved 13 September 2015.
  7. ↑ Global News Wire (15 December 2015). Securities Class Action Lawsuit Against 6D Global Technologies -- SIXD NASDAQ Global News Wire. Retrieved 5 January 2016.
  8. 1 2 Lawrence, Dune (16 March 2016). "The Journalist and the Troll: This Man Spent Two Years Trying to Destroy Me Online". Bloomberg Businessweek
  9. ↑ Graff, Lloyd (20 January 2010). "An interview with Benjamin Wey; The human bridge between China & America". Today’s Machining World. Retrieved 11 September 2014.
  10. ↑ Robinson, Rick (10 February 2002). Benchmark CEO knows foreign markets The Daily Oklahoman. Retrieved 3 September 2014.
  11. ↑ Robinson, Rick (10 February 2002). Gateway to China State company pairs Chinese, U.S. investors. The Daily Oklahoman. Retrieved 3 September 2014.
  12. 1 2 David Barboza, "F.B.I. looks into adviser on Chinese reverse mergers", New York Times Dealb%k, January 27, 2012. Retrieved 11 September 2014.
  13. ↑ "Warning against New York Global Group, Inc". Financial Supervisory Authority (Sweden). 21 June 2011. Archived from the original on 2014-06-16.
  14. ↑ US Securities and Exchange Commission: Public Alert: Unregistered Soliciting Entities (PAUSE) Accessed 16 June 2014
  15. ↑ Scannell, Kara (4 July 2011). "Reverse mergers test US regulators". Financial Times. Retrieved 31 August 2014.
  16. ↑ Norton, Leslie P. (19 May 2008). "AgFeed Trips on Its Way to the Trough". Barron's. Retrieved 11 September 2014.
  17. ↑ American Stock Exchange (24 April 2007). Determination and Notification of Removal from Listing and/or Registration under Section 12(b) of the Securities Exchange Act of 1934 (Bodisen Biotech, Inc.). U.S. Securities and Exchange Commission Archives. Retrieved 11 September 2014.
  18. ↑ Kilzer, Lou (29 March 2012). "Deal Maker Had Hand in Specter Suit, Filing Shows". Pittsburgh Tribune-Review. Retrieved 11 September 2014.
  19. 1 2 United States District Court for the Southern District of New York. (5 January 2012). Cleantech Innovations Inc. vs. NASDAQ Stock Market LLC, Document 11 Civ. 9358. U.S. Securities and Exchange Commission Archives. Retrieved 11 September 2014.
  20. 1 2 3 Yin David (2 August 2013). "In Rare Move, SEC Reverses Nasdaq's Delisting Of Chinese Company". Forbes. Retrieved 11 September 2014.
  21. ↑ Kilzer, Lou (11 March 2011). "Former Sen. Specter: Nasdaq discriminates against the Chinese". Pittsburgh Tribune-Review. Retrieved 31 August 2014.
  22. ↑ What to expect from U.S.-China Summit, Wall Street Journal TV, June 6, 2013. Retrieved 11 September 2014.
  23. 1 2 Salmon, Felix (23 November 2010). "Benjamin Wey and the Power of PR : Columbia Journalism Review". Columbia Journalism Review. Columbia University. Retrieved 2 September 2014.
  24. 1 2 Gurrieri, Vin (30 July 2014). "Worker Fired For Reporting Harassment At PE Firm, Suit Says - Law360". Law360. Retrieved 31 August 2014.
  25. ↑ TheBlot Magazine. Author page: Benjamin Wey. Retrieved 4 September 2014.
  26. ↑ Reuters (3 March 2016). "Judge lets Georgetown law professor's defamation case against online magazine proceed
  27. ↑ Colhoun, Damaris (16 June 2016). "The shadowy war on the press: How the rich silence journalists". Columbia Journalism Review. Retrieved 13 July 2016.
  28. ↑ Brown, Stephen Rex (16 June 2015). "Former Swedish model was stalked, harassed by boss in person and online, lawyer says in opening of $850M lawsuit". New York Daily News. Retrieved 22 June 2015.
  29. ↑ Ax, Joseph/Reuters (29 June 2015). "N.Y. financier ordered to pay US$18M in sexual harassment, defamation suit". Toronto Sun. Retrieved 30 June 2015.
  30. ↑ Madhani, Aamer (7 April 2016). "American executives' names surface in Panama Papers". USA Today
  31. ↑ Bray, Chad (27 January 2012). "FBI Search Offices of 'Reverse Merger' Player". The Wall Street Journal. Retrieved 31 August 2014.
  32. ↑ Carney, John (26 January 2012). "FBI Raids Chinese Reverse Merger Shop". CNBC. Retrieved 31 August 2014.
  33. ↑ Rapoport, Michael (10 September 2015). "New York Global Group Chief Charged With Securities Fraud". Wall Street Journal. Retrieved 13 September 2015.
  34. ↑ U.S. Securities and Exchange Commission (10 September 2015). "SEC Announces Fraud Charges in Cross-Border Scheme to Secretly Control and Manipulate Stock of Chinese Companies After Reverse Mergers" (press release). Retrieved 13 September 2015.
  35. ↑ Hall, Kevin G.; Taylor, Marisa (4 April 2016). "Americans show up in the Panama Papers, too". McClatchy DC. Retrieved 12 April 2016.
  36. ↑ Smith, David (5 April 2016). "200 people in the US exposed for using tax havens in Panama Papers leak". The Guardian. Retrieved 12 April 2016.

Further reading

External links

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