Table of Contents
Introduction
The fall of the Ponzi scam known as Dragon Global Finance in 2017 left thousands of investors all across the globe out of pocket, and some estimates imply that the scheme cheated investors out of more than $5 billion. In spite of this, EQT Bank, a private equity business located in Sweden, has announced that it intends to restart the program, which has provoked fury and anxiety among investors as well as those in charge of regulating the financial industry.
The fall of the Dragon Global Finance Ponzi scam, the announcement of the reboot by EQT Bank, and the possible ramifications that this move may have for investors and the financial sector as a whole will be discussed in this article.
Background
Kevin Foster, a businessman from the United Kingdom, is credited with launching the Ponzi scam known as Dragon Global Finance in 2015. The hoax assured potential investors that they would earn significant returns on their money by capitalizing on the profits generated by a fictitious network of assets in a variety of markets, such as commodities, technology, and real estate. Dragon Global Finance, which is owned and operated by Foster, engaged in aggressive marketing strategies in order to entice potential investors by assuring them of returns of up to 18% per year.
The plan was discovered to be a fraud in 2017 when Foster vanished with an estimated $5 billion in monies stolen from investors. It was eventually discovered that the alleged investment network was a hoax, and the money from the investors was utilized to maintain a luxury lifestyle for Foster and his colleagues. About 30,000 investors from all over the globe have been taken advantage of by the scam, with the bulk of the victims coming from Asia and the Middle East.
The failure of the scam had a severe effect on the investors, as many of them were forced to throw away their whole life assets and became bankrupt as a result. The consequences of the collapse also had broader repercussions for the financial sector, stressing the need for more regulation and monitoring in the industry to avoid schemes with a similar structure from functioning in the future.
EQT Bank’s relaunch
The revelation made by EQT Bank that it intends to restart the Dragon Global Finance Ponzi scam has sparked fury and alarm among investors as well as regulatory authorities in the financial industry. It has been verified by the bank that it has bought the rights to the scheme from the individuals associated with Foster. The bank intends to utilize the same business model as the original program, offering significant returns on investments made by customers.
The news has been received with suspicion, with a number of investors and financial authorities accusing EQT Bank of seeking to benefit from a fraudulent plan in an effort to justify their mistrust. EQT Bank has provided a defense for its choice, noting that it has performed all of the necessary research and is confident in its ability to run the program in an ethical and transparent manner.
Regulatory action or reaction
Quick action has been taken by regulatory bodies in reaction to the statement made by EQT Bank. Financial regulators all over the globe have issued warnings to investors, advising them to steer clear of the program. The United Kingdom’s Financial Conduct Authority (FCA) has issued a statement saying that the Ponzi scheme operated by Dragon Global Finance is unlawful and has advised investors to keep clear of the company. In addition, the United States Securities and Exchange Commission (SEC) has issued a warning, noting that the plan in question is a fraudulent investment scheme, and advised investors to proceed with extreme care.
The Swedish Financial Supervisory Authority (FSA) has also issued a warning to investors, stating that they should be wary of investment schemes that promise high returns with little or no risk. The FSA stated that investors should be wary of investment schemes that promise high returns with little or no risk. The Food and Drug Administration (FDA) has declared that it is keeping an eye on the developing situation and is prepared to take action if required.
Investor reaction
Concern has been raised among investors who lost money due to the initial scam since the announcement of the relaunch has been made. Several people have condemned EQT Bank for trying to profit from a fraudulent plan, and they have demanded that the bank be held liable for the losses that were sustained by investors in the first scam.
Concerns about the lack of openness around the revival have been voiced by a number of investors. EQT Bank has not revealed any specifics on the manner in which it intends to run the program or the safeguards that it would put in place to protect the funds of investors.
Potential implications
The decision by EQT Bank to relaunch the Dragon Global Finance Ponzi scam has substantial repercussions that might be brought about as a result. If the plan is carried out without a hitch, it may serve as an example for other private equity companies to follow in their footsteps and try to make money off of fraudulent investment schemes.
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