Tag: Founders Group International

ICE “Cold” on Dan Liu Immigration Status and Felony Allegations

Above Photo – Chinese police raiding Yigian Funding office}

Dan Liu, owner of Founders Group International, which includes 21 golf courses and other properties in the Grand Strand area, was a participant in the recent One Flight Myrtle Beach Classic pro-am golf tournament. It was surprising to see Liu among the participants considering his questionable immigration status in the United States.
Some background:
Jane Zheng was a native Chinese working as a realtor with a local company in Horry County. Her niche market was other Chinese nationals with seemingly excess cash to invest in U.S. properties.
Zheng connected with Dan Liu, reportedly a managing partner in Yiqian Funding, a peer to peer lending company in China. Yiqian Funding (also known in China as “Easy Richness”} raised money from Chinese investors that was, theoretically, lent to businesses or other entrepreneurs or invested independently. Investors and the company supposedly made money on the interest paid on the loans and on the rise in investment assets.
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Why Did a Chinese Spy Balloon Pass Over Horry County?

There is a certain irony to the fact that a Chinese spy balloon was shot down off the coast of Horry County last week.
The spy balloon was shot down on February 4, 2023, just one day shy of the seventh anniversary of the return of former Horry County Council Chairman Mark Lazarus from a 16-day trip to the People’s Republic of China.
A few days after the return of Lazarus from the China trip, WPDE ran a story headlined “Chinese business leaders Investing more than $100 million in Horry County.” Lazarus told the tv station the venue would be west of the Intracoastal Waterway and would bring several hundred jobs to the area.
The WPDE story went on to say a 25-minute segment from three symposiums, which Lazarus conducted in China, was shown on CCTV (China Central Television). “The presence of Myrtle Beach and Horry County in China right now is huge. We went to a lot of places and that’s all they were talking about,” Lazarus was quoted as saying in the article.
In addition, Lazarus said a “nice article about Myrtle Beach and Horry County and tourism,” was printed in China Daily. Both CCTV and China Daily are propaganda outlets controlled by the Chinese Communist Party Central Propaganda Department.

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Yiqian Investors Suing Dan Liu and Founders Group Entities

Investors bilked out of over $1.1 billion are pursuing a class action lawsuit in federal court against Founders Group International, its associated LLC’s and principal owner Dan Liu.

The lead plaintiffs in the case are Xunhui Cheng, a citizen of the Peoples Republic of China, and Kelan Cai, a citizen of the United States.

Background for this lawsuit is provided below:

Liu, a native of the Peoples Republic of China, first appeared in 2014 buying up golf courses with apparently unlimited amounts of cash. At the time, Liu was hailed as a potential savior of the golf tourism industry in Horry County.

In the 2014-15 timeframe, Liu and his Founders Group International LLC acquired a total of 22 golf courses, various potential development properties and homes. It is estimated his total expenditure in the Grand Strand area was approximately $140 million.

Liu’s wealth supposedly came from his ownership stake in Yiqian Funding, also marketed as “Easy Richness”, a peer to peer lending business in his native China.

By the time Liu staged his society style wedding at his newly acquired Pine Lakes Country Club clubhouse in April 2015, the event was hailed by local media as the Grand Strand’s “first major step into the overseas tourism market.”

But it was all a con.

Storm clouds began to block out this sunny picture in 2016 when Chinese police began raiding Yiqian Funding offices in China. The picture accompanying this article shows police carrying computers and records out of an “Easy Richness” office in China during one raid.

Liu’s principal partner in Yiqian Funding, Xiuli Xue, an attendee at the Liu wedding in Myrtle Beach, and 11 other high ranking associates in the Yiqian Funding organization were arrested in 2016, Xue in Hong Kong as she was attempting to leave the country.

All 12 were convicted at trial for an “illegal fundraising case” designated as a “Series of Yiqian Events.” by the Nanjing District Attorney for Jiangsu Province in China. They are currently serving prison sentences.

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I-73, Indian Wells Controversies Highlight Council Agenda

The agenda for Tuesday night’s regular meeting of Horry County Council has only two items of consequence on it.

Under Old and New Business, council will discuss the Financial Participation Agreement with the South Carolina Department of Transportation for the I-73 project.

The agreement has been in effect since December 2018 when it was signed by former administrator Chris Eldridge for the county after receiving council approval to do so. However, the real date for its beginning is the start of the new fiscal year on July 1, 2019.

Generally the agreement provides that Horry County will provide up to $25 million per year from Hospitality Fee revenues to fund the construction of I-73 within Horry County (the Project) and SCDOT will oversee the project from design through construction.

The written agreement states, “SCDOT shall provide an Annual Work Plan to the county on the activities proposed by March 31 that the county shall approve prior to June 30 before commencing work in the succeeding fiscal year.”

SCDOT provided a work plan for next fiscal year which allots $6 million for engineering services and $6.5 million for right of way acquisition. Council has yet to act on that work plan, but there is NO money in the upcoming budget to pay for it.

The plan was for Horry County to provide up to $25 million per year from 1.5% Hospitality Fee revenues collected countywide as funding. Since March 2019, the county has been sued by the cities over hospitality fee collections and there is no guarantee at this time how much, if any, of the countywide 1.5% fee revenue will be available to the county in the next or ensuing fiscal years.

However, Section V of the agreement, “Payments by the County”, states,  “The County shall maintain an account balance which shall be sufficient to cover the Project expenses for the relevant fiscal year including annual payments to the consultants, contractors or SCDOT…”

In addition, Section III D of the agreement states, “Nor shall the County’s prior approval be required for any right-of-way acquisition agreement or consultant agreement for work of the Project provided the cost thereof does not exceed the estimates provided in the Annual Work Plan.”

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Indian Wells Rezoning on Tonight’s County Council Agenda – Updated

(above picture Dan Liu, left, and Nick Dou)

UPDATE

Once again first reading of the rezoning ordinance was deferred. 

The same scenario played out as before – opponents of the rezoning showed up in force dressed in their now famous red shirts. Once again council member Tyler Servant blinked and asked for another deferral.

It appears there is no desire on Servant’s part to vote against the rezoning or else it would already been voted down. Council members will generally follow the will of the member in whose district the rezoning is located.

Evidently the tactic is to attempt to wait out the ‘red shirts’ until their opposition wanes. However, that may not be the end result here.

There is a determined opposition and the current owner, Founders Group International, apparently needs the property to be rezoned to clinch its sale. It is not believed that the property can be profitably developed with the residential zoning it has now.

First reading of an ordinance for a proposed rezoning of Indian Wells Golf Club is again on the Horry County Council agenda for tonight.

This is the fourth time the issue has been before council for first reading. It was initially defeated late last year. After some tinkering with the proposal, removing the commercial areas and adding more townhomes in an attempt to appease adjacent property owners, the issue has been deferred twice.

There is considerable opposition from owners in three sub-divisions, who thought they were buying golf course view property over the past 20 years only to discover this is not necessarily the case in Horry County.

All but a few of the golf courses in Horry County have underlying zoning that allows for development of the golf course into residences of some type.

Many of properties in the golf course communities surrounding those golf courses were sold on the basis of ‘fairway views’ or ‘proximity to the course’ of the homes, often with premiums charged for properties directly adjacent to the golf course.

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Indian Wells Rezoning Again Up for Consideration by County Council – UPDATE

UPDATE

Horry County Council unanimously voted to defer the first reading of rezoning request for Indian Wells Golf Course until the June 6th regular council meeting. Council will request the Chinese owners of Founders Group International, Nick Dou and Dan Liu, to appear at that council meeting with their attorneys to answer questions about possible restrictions on the property with respect to the current litigation between Dou and Liu and, possibly, to address questions about Liu’s immigration status and Chinese legal problems.

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A third try at first reading approval for a rezoning of Indian Wells Golf Course will come before Horry County Council Tuesday night.

This time around, it appears commercial areas have been removed from the redevelopment plan with townhomes replacing commercial buildings.

This is all part of the game that is played throughout the county to basically give developers what they want while making it appear council is working in the interests of affected citizens.

One of the best kept secrets with respect to development is that virtually all of the golf courses in the county have underlying zoning that allows for future development. That house bought on a fairway in one of the many golf course communities in the area may not always look out on a fairway. In the case of Indian Wells, the fairway view may soon be replaced by townhomes.

The rezoning is being requested for reasons that apparently have to do with making the land more valuable to developers not for any benefit of the current homeowners in the surrounding community.

However, the Indian Wells rezoning has other interesting facets.

Indian Wells is one of the golf courses currently owned by Founders Group International with a mortgage in the amount of $4,769,496.00 payable to Founders majority owner Dan Liu.

Liu is a Chinese citizen in the U.S. on a work visa that appears to have expired in August 2018.

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Proposed Rezoning of Indian Wells Golf Club Raises Many Issues

(pictured above, Dan Liu, left, and Nick Dou)

Horry County Council will again consider first reading of a request to rezone Indian Wells Golf Club for development at its regular meeting next week.

Council has already denied the request once and deferred a changed plan at its last regular council meeting.

Council member Tyler Servant, in whose council District 5 the course is located, has reportedly been working with three homeowner’s associations who will be impacted by the rezoning to get agreement from them for a development plan that has no commercial structures and only townhomes and single family homes.

But, Servant may be missing the forest while concentrating on just one tree. There are more issues at Indian Wells than which development plan can get approval from council.

Indian Wells is one of the golf courses owned by the Founders Group International, a collective of multiple LLC’s with 90% ownership by Chinese companies for which Dan Liu claims to act as exclusive U.S. agent and 10% ownership by Nick Dou, according to documents provided in a lawsuit with Dou as plaintiff and Liu as defendant. According to Liu’s deposition, he met Dou in 2012.

Dou and Liu are currently locked in a legal battle over allegations by Dou that Liu is attempting to strip assets from their corporate interests.

In the 2014-15 timeframe, Founders Group International acquired 22 golf courses, homes and other properties in the Grand Strand area for the total sum of approximately $135 million.

In a deposition for the ongoing lawsuit, Liu claimed the money used for the purchases was taken from his personal funds. However, the deposition included a description from Liu of his work history from the time he left university in 1997. Nothing in that history gave any indication from where Liu would have accumulated such an amount of money.

According to Liu’s statements in the deposition, he placed his personal funds in the above mentioned Chinese companies, with which he claims no association other than being the exclusive U.S. agent, in order to move the funds out of China.

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Chinese Trial Raises Questions About Local Leadership

A criminal trial in China added a clarifying chapter to the saga of Chinese investments in the Grand Strand area and the naivete of local officials who touted them here.

By 2014, the golf tourism business was in serious decline. Owners of golf courses, many still paying off mortgages, were stuck with assets on their books far exceeding their actual market value. Many were quietly trying to sell the courses with little success.

Jane Zheng was a native Chinese working as a realtor with a local company. Her niche market was other Chinese nationals with seemingly excess cash to invest in U.S. properties. At the time, the Chinese economy was growing at such a rate that many Chinese businesses and individuals had considerable excess cash to invest.

Zheng connected with Dan Liu, reportedly a managing partner in Yiqian Funding, a peer to peer lending company in China that received money from Chinese investors that it lent to business or other entrepreneurs or invested it. Investors and the company supposedly made money on the interest paid on the loans or on the rise in investment assets.

Over an approximate 18 month period, Zheng brokered the sale of 22 local golf courses and other development properties to, supposedly, three Chinese corporations for whom Liu was the exclusive U.S. representative.

While not being licensed to do business in South Carolina, according to records of the S.C. Secretary of State Office, the three corporations supposedly formed at least 16 LLCs locally, each holding some of the various golf course and development property assets. One or more of three Chinese corporations owned 90 percent of each LLC with Liu, as the exclusive agent, acting for the corporations. The LLC’s primarily conducted business locally under the name Founders Group International.

Everything looked great. Local owners got rid of golf course properties that had become toxic to them. Liu was playing the big money man locally and his partner in Yiqian Funding, Xiuli Xue, was bringing potential investors to Horry County to see investment opportunities.

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Myrtle Beach City Election Issues

Less than three weeks remain before filing officially opens for the upcoming Myrtle Beach city elections.

Already a number of people have emerged to announce their intention to run against the four incumbents up for reelection. While I’m sure there will be a large field of challengers, we won’t know exactly who is in the race until filing closes.

In the meantime, there are some interesting dynamics developing for this year’s election.

In the past few months, council has drawn criticism for the threatened use of eminent domain to take control of several properties in the Superblock after secretly purchasing approximately 10 other properties in that area.

After being exposed, the city announced a plan to redevelop the area with a new, $10 million building to, reportedly, house Chapin Memorial Library and a new Children’s Museum.

There are questions whether eminent domain taking of a property can be used for such a purpose and whether $10 million of taxpayer money is best spent on this project when public safety needs, among others, are critical at this time.

Shootings on Ocean Boulevard and in other parts of the city highlight the amount of violence that has infringed on Myrtle Beach streets. After the Father’s Day weekend incident during which eight people were wounded on Ocean Boulevard, the city placed barricades on one section of Ocean Boulevard, ostensibly for crowd control, but in front of retail stores and restaurants which occupy an area the city would also like to see be redeveloped.

The businesses in the area of the barricades reported drops in sales of 30-60 percent from previous years numbers.

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Dan Liu Fires Back at Founders Group International Partner

(Pictured above, Dan Liu (left) and Nick Dou in happier times)

Dan Liu, majority partner of the Founders Group International entities, fired back hard at minority partner Nick Dou in answering a complaint in a lawsuit filed by Dou against Liu, three Chinese corporations and the many limited liability companies that make up the Founders Group International holdings.

According to Dou’s complaint, the three Chinese corporations were 90 percent owners of the Founders Group properties and Dou was 10 percent owner. Liu was the exclusive authorized agent in the U.S. for the Chinese corporations.

In his lawsuit, Dou alleges Liu was stripping assets out of the corporation for personal and other uses. The suit alleges breach of contract, fraud and conversion by Liu.

Additionally, Dou asks for a full accounting of corporate assets as well as a temporary restraining order directing Liu “shall not divert, remove, alienate, convert, encumber or otherwise manipulate any corporate assets of FGI or any of the other FGI Entities for his personal use or benefit, until such time as the claims raised in this action have either been resolved by this Court, settled and/or withdrawn by the Parties to this action…”

The complaint also states, “Plaintiff Nick Dou is informed and believes that the assets and property of FGI and the affiliated FGI Entities are at grave risk and danger of loss, and of material injury and impairment, at the hands of Defendant Dan Liu, if such property and assets are left under the exclusive control of Defendant Dan Liu.”

Dou’s complaint also states, “Upon information and belief, on or about March 27, 2017, the Nanjing District Attorney’s office for the Jiangsu Province of the PRC issued public statements that it seeks the arrest of Defendant Dan Liu for suspicion of investment fraud and “absorbing public money.”

A copy of this public statement release was submitted as an exhibit with Dou’s complaint.

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