US arrests Chinese tycoon who backed Trump adviser Bannon

Guo Wengui and Je Kin Ming allegedly stole funds from investors to buy a yacht, a 4645 sqm mansion and a $US3.5m Ferrari.

A policeman enters New York’s Sherry-Netherland hotel, where Guo Wengui has a penthouse apartment, on Wednesday. Picture: AFP

A Chinese tycoon wanted in China and closely tied to Donald Trump’s former presidential political adviser, Steve Bannon, has been arrested in New York and charged with bilking some $US1bn ($1.5bn) from supporters of his anti-Beijing activities.

The US Justice Department accused Guo Wengui and still-at-large British co-conspirator Je Kin Ming of stealing funds from participants in an investment scheme so they could buy luxuries, including a yacht, a 4645 sqm mansion and a $US3.5m Ferrari.

A court official said late on Wednesday that Mr Guo pleaded not guilty but consented to detention in an initial arrest hearing.

Hours after his 6am Wednesday arrest at his Manhattan penthouse apartment overlooking Central Park, a fire broke out in his building, raising suspicions the two could be linked.

Mr Guo’s arrest came nine years after the one-time property billionaire fled China in 2014, having faced charges of fraud and corruption even as he became a critic of graft inside the Chinese government.

Using his Cantonese name, Ho Wan Kwok, the Justice Department said Mr Guo leveraged his prominence as a critic of Chinese leader Xi Jinping’s government while exiled in New York to build a large following of supporters online. Those supporters were encouraged to donate to, or invest in, Guo-controlled non-profits and businesses, including GTV Media group, of which M Bannon was a director.

Guo Wengui leveraged his prominence as a critic of Xi Jinping’s government while exiled in New York to build a large following of supporters online. Picture: AFP

That activity spread into other avenues to raise hundreds of millions of dollars, including a luxury club, the Himalaya Exchange cryptocurrency issuer, and the Himalaya Farm Alliance, which promised investors discounted shares in GTV. But the Justice Department said Mr Guo and Mr Je diverted funds for their own use, including for the former’s New Jersey estate and yacht, a custom-built Bugatti sports car, and two mattresses that cost $US36,000 each.

In 2021, US financial authorities called GTV’s investment solicitation an illegal public offering and forced Mr Guo to repay investors nearly $US500m and pay nearly $US40m in fines.

Since then, in successive actions, authorities have seized around $US634m in funds raised by Mr Guo and Mr Je, and on Wednesday charged the two with multiple counts of securities fraud, wire fraud, money laundering and obstruction.

“Fraudulent investment scams make victims out of innocent people, ultimately harming the public’s confidence in the integrity of financial systems,” FBI assistant director Michael Driscoll said.

Mr Guo arrived in the US in 2015 after fleeing a crackdown on China’s racy billionaires and corrupt officials by Mr Xi’s administration. He was accused of paying hefty bribes to a powerful state intelligence and security chief. But he claimed he was the victim of a business dispute with a former top Communist Party official.

Later he claimed to have details of business dealings by Wang Qishan, Beijing’s all-powerful anti-corruption tsar and later China’s vice-president.

He made a splashy arrival in the US, buying a $US67.5m Manhattan penthouse and promoting himself as persecuted by the Chinese government, applying for political asylum.

In 2017, at Beijing’s request, Interpol issued a red notice – a non-binding warrant – seeking Mr Guo’s arrest and extradition.

It sent security services officials to New York to pressure him to return. And it recruited sympathetic US businessmen with ties to Mr Trump to persuade him to deport Mr Guo.

But the Trump administration didn’t take action, and in late 2017 Mr Bannon, having left his White House job, began working with the Chinese tycoon.

Together they built heavily political media operations including Mr Guo’s broadcasts to China and Bannon’s War Room podcast, which remains strongly pro-Trump and anti-China. In 2020 Bannon was arrested for defrauding donors while he was aboard Mr Guo’s $US35m, 150-foot yacht anchored off Connecticut.

AFP