assetsfx.com

assetsfx.com

Chinese Animation Studio Says It Is Victim of Massive $234 Million Fraud - Dailyforextrading

assetsfx.com

Chinese Animation Studio Says It Is Victim of Massive $234 Million Fraud - Dailyforextrading

Chinese visual effects and animation studio filed a lawsuit Thursday alleging that it is the victim of two American swindlers who forged documents, impersonated the CEO, and conned investors out of $234 million.


Base FX, headquartered in Beijing, states that it was duped into trusting the two men — Remington Chase and Kevin Robl — over the course of several years, in which they engaged in several financing arrangements and a joint venture in Malaysia.

However, over the last year and a half, the company has discovered that the men were using the relationship as a lure for investors, who were deceived into signing over $234 million, in what they thought were loans and investments in the company and its projects.

Base FX alleges that Chase and Robl forged the signature of the company’s CEO on investment documents, created fake entities and bank accounts, had someone pretend to be the CEO in calls with investors, and set up a fake office for the company in Pasadena, Calif.

The company is unable to account for any of the funds and says that the two men appear to have siphoned off millions of dollars for their personal use.

Base FX employs about 450 workers, and did effects work on blockbusters like “The Avengers,” “Captain America,” and “Iron Man,” as well as TV series including “The Mandalorian” and HBO’s “Boardwalk Empire.”

The company also produced an animated film, “Wish Dragon,” which was released theatrically in China and elsewhere on Netflix.

The company is now facing angry demands and lawsuits from investors who were swindled. The company has notified the FBI, and Chinese detectives have also begun a probe into the case, and have detained at least one Chinese national, according to the lawsuit.

The whereabouts of Chase and Robl are unknown. Efforts to reach Robl for comment were unsuccessful. An attorney who represented Chase in a prior and unrelated action brought by the Securities and Exchange Commission declined to comment.

Chase, who is known to friends as “Bill,” is a former film producer who contributed financing for a series of action films in 2012-14, including “End of Watch,” “Lone Survivor” and “Escape Plan.”

In 2014, the L.A. Weekly reported that he and an associate, Stefan Martirosian, each had criminal convictions for cocaine trafficking, were alleged to have been involved in an international assassination plot, and had each worked as federal informants.

Chase subsequently dropped out of public view but continued to cultivate relationships in the entertainment industry.

The CEO of Base FX, Chris Bramble, was introduced to Chase in 2013 by the company’s agency, United Talent Agency. At the time, Base FX was looking to expand its special effects business and get into the production of live-action and animated films.

Chase was presented as a “proven and successful financier,” according to the lawsuit. In 2015, the CEO of Film Finances Inc., a global leader in completion bonds for TV and film projects, also vouched for Chase, according to the lawsuit, telling Bramble that he had worked with Chase over the years and developed a strong business relationship as well as a friendship.

Chase courted Base FX for several years, in what the lawsuit describes as a “long con.” Chase invited Bramble to his hangar at Hawthorne Municipal Airport, near LAX, where Chase introduced him to billionaire Elon Musk, with whom he appeared to have a relationship.

On a separate occasion, Chase flew Bramble in his helicopter to Kevin Costner’s house. Costner met them on the front lawn and they had lunch together, according to the complaint.

Bramble agreed to go into business with Chase in 2017. Chase provided financing for “Wish Dragon,” an animated co-production from Base FX, Sparkle Roll, and Sony, and also provided funding for a new visual effects studio in Malaysia, in exchange for 46% of the equity in the joint venture.

Chase also vouched for his associate, Robl, a scriptwriter and producer who was also engaged in film financing. In 2020, President Trump appointed Robl to the President’s Advisory Committee on the Arts of the John F. Kennedy Center for the Performing Arts.

Robl had contributed $100,000 in total to the Trump campaign and to the Republican National Committee in September 2019, according to campaign finance records.

According to the lawsuit, once Base FX went into business with Chase and Robl, the two gained intimate knowledge of the company’s finances and operations, which they could use to deceive potential investors.

The suit alleges that Chase and Robl would borrow from investors in the company’s name, pass on a portion to the company, and they pocket the difference. They also purported to transfer equity and security interests in Base FX’s projects to the investors, according to the suit.

In 2019, Base FX agreed to grant Chase a 5% equity stake in the company, as well as a portion of the potential profits in “Wish Dragon,” in consideration for the investments he had obtained. Chase also gave up his stake in the Malaysia studio, which was foundering and on its way to becoming a failed investment.

Revealed In 2022
Best Day Trading Strategies for Beginners

The SEC announced a civil case against Chase in September 2020, alleging that he had swindled investors in another company, Knightsbridge Entertainment.

The SEC charges — which Chase agreed to settle without admitting to wrongdoing — alleged that he had diverted $9 million of investor funds to his own personal use, including $1.8 million to pay credit card bills, $1.5 million to make a gift to the University of Southern California, and nearly $1 million to purchase several Teslas.

Knightsbridge had raised $62 million in total, only a third of which went to its stated purposes, while other funds were used to pay off unrelated obligations, according to the SEC.

In November 2020, investors began contacting Base FX, demanding payments on loans made to the company through Chase and Robl, according to the Base FX lawsuit. It was then that Base FX began to unravel the elaborate web of forgeries, the suit alleges.

Throughout 2021 and into early 2022, Base FX received a series of repayment demands totaling $234 million — far exceeding the $50 million enterprise value of the company.

After being hit with a demand for repayment on a $100 million line of credit, Bramble confronted Robl, who “apologized and pled with the Base CEO not to contact the authorities, promising to pay back all the funds,” the suit states.

Bramble also confronted Chase about one of the forged documents, according to the suit.

“Defendant Chase admitted that Defendants had created the forged document, and assured Base’s CEO that Defendants would repay all funds owed to investors,” the lawsuit states. “Base has since learned, however, that Defendants have not repaid their investors and continue to raise funds by wrongfully claiming to be affiliated with Base.”

The suit alleges that Base FX has suffered “severe reputational harm throughout the entertainment industry,” and is now faced with defending itself from a series of investor lawsuits.

On March 2, investors Paul Liang and Fang Fang Ho filed a federal suit against Chase, Robl, Bramble, Base FX, and numerous other entities, seeking repayment of nearly $41 million.

That suit alleges that Robl and Chase courted Liang and Ho by taking them to the premieres of “Wish Dragon” and HBO’s “Westworld,” and to the set of “Willy’s Wonderland,” a Nicolas Cage film that was shooting in Georgia. Chase, a former child actor, also claimed to have been childhood friends with Kathleen Kennedy, the “Star Wars” producer, according to the suit.

The suit also accuses Bramble of assuring the investors that Chase and Robl were trustworthy. According to the suit, the plaintiffs received regular payments on their investment until 2019, when a payment was delayed. The payments stopped completely in 2020.

Trendy News
WALL STREET BONUSES HIT A RECORD HIGH OF $257,500 PER WORKER LAST YEAR

The investors sought repayment throughout 2020 and 2021, receiving repeated assurances that they would get their money back. On Jan. 27, 2022, the investors were sent a forged confirmation of a wire transaction, according to the suit. Source: Variety.

 

 

  • Share:

HOW CAN WE HELP YOU?

[email protected]