The Oversea Chinese Fund : a complex affinity-based Ponzi scheme

This paper describes an affinity-based Ponzi scheme in Canada, the Oversea Chinese Fund Limited Partnership, created in 2001 by Weizhen Tang. Unlike simpler schemes, it adopted a complex structure involving multiple financial services firms and feeder funds in Canada and the US. Although the scheme collapsed in early 2009, its repercussions reverberated a decade later when Tang attempted to recidivate in 2019. Our paper uses Tang's scam to examine factors that contribute to the victimization of Ponzi schemes from the perspectives of behavioral finance and psychology, which includes the roles of perpetrators, investors, and regulators. We discuss the lengthy litigation process and weak enforcement that were features of this case. We also propose some suggestions for coping with such crimes.