Fraud from a European island

 How did investors lose millions of dollars through 'Teacher' and a Chinese messaging app? 

A seaside hotel and former bank offices on the Isle of Man are being used by fraudsters to defraud Chinese nationals of millions of dollars.

A BBC World Service investigation revealed that the dining room of a seaside hotel in Douglas, capital of the Isle of Man, was packed with dozens of Chinese workers sitting in front of computers using high-speed internet. .

A special stove was also ordered for the hotel kitchen.

According to Chinese court documents, the forgery continued from January 2022 to January 2023. Fraudsters used the 'pig butchering' method to defraud people of millions of dollars.

The term 'pig butchering' means that fraudsters first try to gain the trust of victims and then defraud them when they succeed in gaining their trust.

It took the BBC almost a year to find out how the fraud was being carried out on the Isle of Man. The Isle of Man is one of the British Isles in the Irish Sea, where there is a sovereign government.

We also learned that the masterminds of the fraudsters had plans to build a large office by the Irish Sea.

Not only has the BBC obtained relevant court documents, but we have also had access to leaked documents and to some people working at the company.

Jordan (name changed), a former employee of the company, says that when he arrived on the Isle of Man, he had no idea he was entering a dark world.

He says that he is quite happy to think that he has got a reliable job.

However, in the meantime, he could not help but notice that his company was somewhat mysterious. For example, Jordan and his colleagues were not allowed to take pictures during the events held there.

He says that he did not know that his Chinese colleagues there were actually professional counterfeiters.

By the end of 2021, around 100 people had been transferred to the Isle of Man. Chinese court documents refer to the company as 'MIC'. These men were working in the Philippines before being sent to the Isle of Man.

The BBC learned that MIC actually stands for Manx Internet Commerce.

In the Isle of Man, MIC was part of a group of several companies, all owned by the same company.

The most prominent of these companies was an online casino run by King Gaming Limited. Keep in mind that gambling and betting have been declared illegal in China.

But the purpose of building this casino away from China was to get Chinese customers to avoid the law and the Isle of Man had lower gambling taxes.

After spending a few months at the Seaview Hotel in Douglas, MIC employees were transferred to a former bank office in the eastern region.

According to Jordan, in the same office, he sometimes heard the sounds of his new colleagues celebrating. They believe they were celebrating successfully defrauding someone nearly five thousand miles away.

Six MIC employees have also been sentenced for defrauding Chinese nationals on their return to China.

These cases were heard at the end of 2023 and during this time the facts about how the black money was being earned came to light.

These men ensnared people in the Philippines and the Isle of Man. According to Chinese court documents, the accused worked with multiple teams and recruited Chinese investors into chat groups on popular Chinese messenger app QQ. In these groups, one of the accused would play the role of an investment 'teacher' while other fraudsters would pretend to be capitalists.

Evidence seen by the BBC suggests that a number of people who came to the Isle of Man from the Philippines were involved in defrauding people. All these people used the same computer, used QQ messenger for their work and almost all the employees had the same job title or position except for some managers

The bogus investors in the group would create an environment where it would appear that the 'Teacher' has the reigns to make money.

According to Chinese court documents, the teachers would then tell their victims which platforms or businesses they should invest in.

Influenced by all this environment, investors would listen to the 'teacher' and then fall prey to fraudsters running various platforms or businesses.

The Chinese court said it was difficult to confirm how much the victims suffered in total, but it found that about 12 victims were defrauded of $5.3 million.

With the help of the evidence presented, confessions of the accused, travel and financial records, the Chinese court found the six accused guilty.

According to court documents, it was not only a lucrative but highly sophisticated fraud, with the accused working with teams and using all their skills to convince people to invest in the fake business.

The name of the beneficiary of the companies defrauding people was hidden behind layers of administrative documents, but the BBC still discovered the man's name.

MIC and its affiliated companies were operating under a trust set up by a man named Bill Morgan. According to the documents, the man is also known as Liang Lingfei.

According to Jordan, employees used to call him 'Boss Liang'.

According to Chinese court documents, a man named Liang Lingfei is a co-founder of MIC in the Isle of Man. According to these documents, MIC is a "criminal organization involved in activities such as fraud".

Liang Lingfei was not tried in court, and there was no one to represent him.

The court further stated that Liang Lingfei was also a co-founder of a similar organization in the Philippines. The BBC has seen evidence which suggests that many MIC employees were working in the Philippines before coming to the Isle of Man.

During our investigation, it also came to light that Liang Lingfei had obtained an investment visa in the Isle of Man. Liang Lingfei's wife also owns a house in the Balasala area near the island's airport.

The Isle of Man-based companies have big ambitions and last year signed a deal to set up their company headquarters at the Parkland Campus, which will be built on a former naval training base. was

The developers say it is the largest private investment ever made in the Isle of Man.

The buildings seen on Mount Douglas in the photographs held by the architects face directly towards the sea. Inside these buildings will be penthouse apartments, a spa and several bars.

This campus was being built for the employees of MIC and other related companies. Among them were those who were involved in the online betting business.

According to a conservative estimate, $60 billion is earned globally through 'pig butchering'.

"This is the first case we have seen in which operations are being conducted in a Western country for this kind of fraud," says Masoud Karimipour, who closely monitors organized crime and is associated with the United Nations.

He says that such fraud is a bit harder to stop and it's a battle that "organized criminals are winning."

Masood says that criminals are looking for places around the world where they can take advantage of legal loopholes.

In April, police raided the former offices of a bank in the Isle of Man. They also operated in a building adjacent to the Courts of Justice and used a ladder to enter through a window on the first floor.

In a statement issued after the operation, the police said that the raids were carried out at the offices of King Gaming Limited following an investigation into fraud and money laundering. Seven people were arrested during the operation, who were later released on bail.

After that, three more arrests were made in this case.

The gambling regulator in the Isle of Man has withdrawn the gambling licenses of MIC affiliated companies.

The site where the parkland campus was to be built has been cleared of trees, but construction has been put on hold indefinitely.

The BBC has made several attempts to contact people associated with these companies and Bill Maughan/Liang Lingfei, but has yet to receive a response.

We also tried to contact Sea View Hotel but did not receive any response from them. There is no evidence that the management of this hotel was aware of the illegal activities taking place there.

|Howtoreserch |Fallow |