Monthly op risk losses: China bond fraud implicates leading banks

Breakdown of top five loss events. Data by ORX News

Image of Guangfa Bank
Guangfa Bank branch in Dalian, China

The largest loss this month relates to a Ponzi scheme. On December 20, 2017, the US Securities and Exchange Commission charged the Woodbridge Group of Companies and its founder Robert Shapiro with running a $1.22 billion Ponzi scheme affecting 8,400 investors nationwide.

According to the regulator, Shapiro and Woodbridge told investors they could make returns of between 5% and 10% through his business model in which he made short-term loans to third-party companies for 11% to 15% interest.

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