Wire fraud charges target 5

Five Los Angeles-area residents have been indicted on charges of running a $30-million illegal pyramid scheme targeting Chinese American communities in Los Angeles, San Francisco and New York City, authorities said.

An L.A. federal grand jury returned an indictment last week that alleged that for about three years beginning in 2011, the five men and women operated Hong Kong-based companies that purported to make money selling online education courses for children.

Authorities allege that investments were solicited primarily from Chinese Americans. Investors turned over payments of $1,380 and were falsely promised easy returns and shares of the company ahead of a public offering.

Authorities allege that, in fact, the more than $30 million generated was from the investments, not from the educational courses, and that the only way investors could see returns was by reeling in new investors.

The five kept $6.5 million of the $30 million, with the remaining money spread between others who were in on the scheme, authorities allege.

Those indicted were current or one-time residents of Los Angeles County, including Heywood Chang, 47, and Toni Chen, 46, a couple who lived in Hacienda Heights; Wendy Lee, 53, of Rowland Heights; and David Guo, 53, and Kiki Lin, 50, of L.A.

They were arrested this month and each is charged with one count of conspiracy and 13 counts of wire fraud.

The men and women could each face five years in federal prison for the conspiracy charge and up to 20 years in prison for each of the wire fraud charges.