FEDERAL authorities have made several arrests, shut down companies and frozen millions of dollars in assets in a crackdown on fraudulent money traders who preyed on Chinese immigrants in the US and spirited their investments into Hong Kong bank accounts. Five men are awaiting trial in New York and two associates are being hunted by police after FBI agents broke a syndicate of Chinese companies guilty of milking investors of at least $45 million. And in separate cases cracked by the Commodity Futures Trading Commission (CFTC), 23 employees of commodities brokers have had assets frozen and been banned from trading after complaints from investors. In the most recent development, CFTC investigators have won a permanent injunction against Moses Wong, of California-based Pundi Forsten International - an offshoot of a Hong Kong company - banning him from further trading, and ordered him to hand over US$1.1 million (HK$8.5 million) in assets sitting in company bank accounts with the Dah Sing Bank in Hong Kong. Pundi-Forsten first had its assets frozen in January when the commission accused it of engaging in illegal trading. Most recent cases are linked with what investigators call ''affinity fraud'', where recent immigrants, usually Chinese, are swindled out of their savings by fellow Chinese businessmen whom they have taken into their trust. The scams usually consist of investors handing over money for supposed use on futures, gold or forex exchanges. The companies then secretly hive off the money to Hong Kong, claiming to clients their investments were hit by an unexpected drop in the market. Investors are also often recruited by friends and colleagues of the trading companies, which make them sign waivers of liability on English-language contracts they cannot read. In the case before a Brooklyn court, three men, Hollman Cheung, Phong Thien Nguyen and Keith Tam, have denied charges of wire fraud. Two other men, who have co-operated with authorities and pleaded guilty, have not been named. Two other men, a Ricky Ng and Morris Ching, are being sought. The seven traded under the names Profitable Bullion of Alhambra California, and World Bullion and United Bullion of New York. Federal agents say the companies took money off about 500 people and sent most of it to Hong Kong, usually to bank accounts in the names of relatives or friends, without having invested a cent. The CFTC asset-freeze follows joint investigations with Hong Kong's Securities and Futures Commission into New York companies Standard Forex, Pacific Bullion and Global Bullion for violating federal trading laws. Standard Forex - which is alleged to have accounted for US$3.8 million in investors' losses - is affiliated to a Chinese Government-owned company, China Venturetech, which denies any involvement. No criminal charges have been laid. ''Some people have had nervous breakdowns and several have tried to commit suicide after losing all of their money,'' said Yvonne Du, of New York. She is the spokeswoman for 57 investors - one of whom lost US$125,000 - who have asked federal authorities for help in recovering their losses. Mrs Du, 47, an immigrant from China, joined the Standard Forex company as a trainee trader and invested US$50,000 of her family's savings. The cash disappeared. She said she had felt her investment was secure because of the company's link to an official Chinese Government firm. Hong Kong Commercial Crime Bureau Chief Superintendent Neil McCabe said he was aware of the case and that ''under normal circumstances'' he would expect the US authorities to request assistance, given the Hong Kong connections. As yet, though, there had been no communication.
