Yang Bin, the former second-richest man in China, has been sentenced to six years in a Singapore prison. The 61-year-old Chinese-Dutch national was found guilty of operating a multi-million-dollar Ponzi scheme disguised as a crypto investment operation.

Yang pleaded guilty to eight charges, including conspiring to engage in a fraudulent scheme and operating without a valid work permit. On August 26, he was fined S$16,000.

Local media reported that Yang's fraudulent activities, conducted under the name A&A Blockchain Innovation, attracted more than 700 investors. These investors lost S$1.1 million out of a supposed S$6.7 million invested between May 2021 and February 2022.

The Ponzi Scheme

A&A Blockchain Innovation purported to own 300,000 cryptocurrency mining machines, promising investors daily returns of 0.5%. However, no such machines existed.

Yang used money from new investors to pay returns to earlier investors, a classic Ponzi scheme tactic. The fraudulent operation was revealed when investors began to suspect the legitimacy of their returns.

This isn't Yang's first brush with the law. In 2003, a Chinese court sentenced him to 18 years for tax evasion.

He served part of his sentence before being released in 2016. His legal troubles began in 2002 when North Korea appointed him to oversee economic development in the Sinŭiju Special Administrative Region. Soon after, Chinese authorities placed him under house arrest on charges of tax evasion.

Latest Scam and Legal Proceedings

Yang's latest scam involved an app that displayed fake returns to investors. The system was centralized, allowing the system manager to input random figures showing fake returns of real money.

Deputy Public Prosecutor Wong Shiau Yin stated that Yang played a significant role in the operation and made no restitution to the victims. Authorities recovered S$100,000 from Yang's residence, which he admitted belonged to the investors.

District Judge Brenda Chua sentenced Yang to six years in jail, noting his higher culpability than his co-accused, whose ongoing legal proceedings continue.

Yang's lawyer, Teo Choo Kee, slightly reduced his sentence by arguing that his client had cooperated with the police and entered an early guilty plea.

The Warning to Investors

The sums involved were substantial, and the victim's grievances were years long, with no restitution made to date. "Yang's punishment is a loud warning to all who invest in unregulated and fraudulent crypto schemes," said Judge Chua.

This case teaches investors to exercise extreme caution before investing in any fund, especially in the rapidly growing cryptocurrency industry.