A planned protest by victims of the GemCoin scheme in Arcadia has been abruptly canceled. Investors citing threats of violent retribution against themselves and their families have abandoned their demonstration against USFIA, a company accused of operating a massive Ponzi operation.
The protest, scheduled for outside Arcadia City Hall, was organized by individuals who collectively lost hundreds of thousands of dollars. Many of these USFIA investors are Chinese immigrants. They reported receiving threats directed not only at them but also at family members residing overseas. This vulnerability to threats against relatives abroad has become a significant factor in the decision to call off the demonstration.
Earlier this week, at a separate press conference, some USFIA protesters voiced serious safety concerns. They pointed to allegations of firearms kept at the office complex and home of an individual identified as Chen. Arcadia Weekly obtained photographs showing Chen holding a high-power rifle. Additional images depict men described as Chen’s associates posing with a shotgun and a machine gun.
One GemCoin investor, who has been in contact with both the Arcadia Police Department and the FBI, stated that a man he identified as Baoping Zhang, described as Chen’s head of security, threatened to kill him. This alleged threat occurred in April 2014 when the investor was attempting to recover his money. Jason Ning, speaking through a translator, recounted his dealings with Chen, Wuo, and Gemcoin, which began in September 2013. Ning alleges that during an incident at Chen’s company headquarters, Zhang pointed a gun at his head and threatened his life. Sam Huang corroborated Ning’s account, claiming Chen’s security chief boasted about threatening Ning with a firearm. The specific individuals responsible for the recent threats against the USFIA protesters remain unconfirmed.
Coinciding with the protest cancellation, USFIA released a statement denying involvement in a GemCoin Ponzi scheme. The company's press release, featuring a GemCoin logo, outlined its business operations. USFIA stated it is a California-registered corporation selling gemstones and jewelry, offering reward points with purchases redeemable for other gemstones. The company utilizes distributors who earn commissions on product sales, with no commissions paid for recruiting new members. USFIA directed inquiries to its official website for information on products, distribution, and reward points. The company asserted it employs a professional security firm to protect its products displayed at its Arcadia headquarters. USFIA maintains its products are genuine gemstones and that it owns gemstone mines. The company stressed it operates as a gemstone seller, not an investment firm. It also stated that "GemCoin" is a cryptocurrency product soon to be registered, and that USFIA does not sell it.
The Securities and Exchange Commission (SEC) previously filed charges against USFIA and its founder, Bo (also known as Bobby) Chen, alleging a fraudulent scheme that defrauded investors of at least $1.5 million through the sale of GemCoin. The SEC’s complaint, filed in the U.S. District Court for the Central District of California in 2015, accused Chen and USFIA of misrepresenting GemCoin as a legitimate investment opportunity, promising substantial returns. The SEC sought permanent injunctions, disgorgement of ill-gotten gains, and civil penalties.