DA Vance Announces Indictment of Olivet University Officials and Christian Media CEO in $25 Million Fraud Probe Arising out of Newsweek Investigation


November 15, 2018

Manhattan District Attorney Cyrus R. Vance, Jr., today announced a superseding indictment charging OLIVET UNIVERSITY (“OLIVET”); ANDREW LIN, a/k/a TONY LIN, Chairman of the Board of Trustees of OLIVET; LINGYI XIAO, a/k/a/ JOHN XIAO, OLIVET’s Finance Director and Dean of Olivet Business School; and WILLIAM ANDERSON, CEO of CHRISTIAN MEDIA CORPORATION and OLIVET Trustee, for fraudulently obtaining at least $25 million in financing under OLIVET’s name, and laundering the money in order to obscure its origins and fund OLIVET’s operations.
 
Today’s indictment supersedes – and includes – the charges announced last month against IBT MEDIA, INC., a/k/a NEWSWEEK MEDIA GROUP, ETIENNE UZAC, WILLIAM ANDERSON, CHRISTIAN MEDIA CORPORATION (“CMC”), and OIKOS, for fraudulently obtaining $10 million in financing, and laundering the money through a network of corporate bank accounts.
 
In total, the defendants are alleged to have obtained approximately $35 million in funding through their scheme. They are charged in a sixteen-count New York Supreme Court indictment with Scheme to Defraud in the First Degree, as well as various counts of Conspiracy in the Fourth Degree, Money Laundering in the Second Degree, Falsification of Business Records in the First Degree, and Criminal Contempt in the Second Degree.[1] 

“After unmasking the scheme to keep Newsweek and Christian Media Corporation afloat, my Office’s Major Economic Crimes Bureau skillfully followed the money, revealing an even larger scheme to defraud lenders throughout the country, and cycle the ill-gotten gains through a maze of corporate bank accounts,” said District Attorney Vance. “If you illegally move money through New York’s financial system, my Office will hold you accountable, whether your business is securities, magazines, or university degrees. This investigation remains ongoing, and anyone with relevant information is encouraged to contact us.”
 
According to court documents, ANDERSON was the Chief Executive Officer of CMC and an OLIVET Trustee; XIAO was OLIVET’s Finance Director and Dean of Olivet Business School; LIN was the Chairman of OLIVET’s Board of Trustees; UZAC was the co-owner and Chairman of IBT MEDIA, INC. (“IBT”); and an unindicted co-conspirator was the General Manager of OIKOS NETWORKS (“OIKOS”). The defendants worked together to obtain loans from financial institutions to purportedly purchase sophisticated computer servers valued at a range of $130,000 to $180,000.
 
In order to secure the financing, ANDERSON and XIAO overstated the financial health of OLIVET to prospective lenders, and provided false financial statements to the lenders. To make their false financial statements appear legitimate, the defendants and unindicted co-conspirators created a fictitious auditor, “Lynn Chen CPA,” and created and maintained a phone number and email address for “Lynn Chen,” knowing that no CPA by that name audited OLIVET’S financials.
 
Over the course of the fraud, OIKOS, which the parties held out as an independent vendor, received at least $25 million from seven lenders, purportedly to provide high-capacity computer servers to OLIVET. Instead, OIKOS worked together with the other defendants to engage in sham computer sales transactions, and immediately transferred nearly all of the funds to accounts controlled by ANDERSON, XIAO, OLIVET, and the unindicted co-conspirators.
 
The defendants then transferred the funds through multiple accounts to mask their origin, and to disguise the fact that the funds weren’t being used to purchase equipment. The money was used to purchase real estate, fund OLIVET’s day-to-day operations, and for other purposes unrelated to the stated purpose of the financing. ANDERSON and XIAO also used some of the money to make payments on previously-received financing, helping to ensure that the lenders would not notice the scheme and would continue to fund fraudulent financing transactions. In some cases, funds received for fraudulent Olivet loans were sent to IBT MEDIA, a.k.a. NEWSWEEK MEDIA GROUP; in other cases, funds received from fraudulent Newsweek loans were sent to OLIVET.
 
The indictment is the result of an ongoing investigation by the District Attorney’s Major Economic Crimes Bureau.
 
Assistant D.A.s Solomon Shinerock and Sean Pippen are handling the prosecution of this case under the supervision of Assistant D.A.s Julieta Lozano, Deputy Chief of the Major Economic Crimes Bureau, and Christopher Conroy, Chief of the Major Economic Crimes Bureau, as well as Executive Assistant D.A. Michael Sachs, Chief of the Investigation Division. Senior Investigator Anthony Santoro, Financial Intelligence Analyst Rosalind October, Forensic Accountant Investigator Ken Zorn, Investigative Analyst Annie Wattenmaker, and Paralegals Ashley Richards and Matt Nelson assisted with the investigation.
 
District Attorney Vance thanked the New York State Police and particularly Troop K for its assistance with the investigation.

[1] The charges contained in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty. All factual recitations are derived from documents filed in court and statements made on the record in court.


Defendant Information:

OLIVET UNIVERSITY
 
Charged:

  • Money Laundering in the Second Degree, a class C felony, two counts
  • Scheme to Defraud in the First Degree, a class E felony, one count
  • Conspiracy in the Fourth Degree, a class E felony, one count
  • Falsifying Business Records in the First Degree, a class E felony, two counts
  • Criminal Contempt in the Second Degree, a class E felony, one count

 
LINGYI XIAO, a/k/a JOHN XIAO, D.O.B. 10/03/1980
New York, NY
 
Charged:

  • Money Laundering in the Second Degree, a class C felony, two counts
  • Scheme to Defraud in the First Degree, a class E felony, one count
  • Conspiracy in the Fourth Degree, a class E felony, one count
  • Falsifying Business Records in the First Degree, a class E felony, two counts

 
ANDREW LIN, a/k/a TONY LIN, D.O.B. 8/18/1980
Cerritos, CA
 
Charged:

  • Scheme to Defraud in the First Degree, a class E felony, one count

 
WILLIAM ANDERSON, D.O.B. 1/14/1985
New York, New York
 
Charged:

  • Money Laundering in the Second Degree, a class C felony, four counts
  • Scheme to Defraud in the First Degree, a class E felony, one count
  • Conspiracy in the Fourth Degree, a class E felony, two counts
  • Falsifying Business Records in the First Degree, a class E felony, seven counts
  • Criminal Contempt in the Second Degree, a class E felony, one count

 
ETIENNE UZAC, D.O.B. 1/1/1983
New York, New York
 
Charged:

  • Money Laundering in the Second degree, a class C felony, two counts
  • Scheme to Defraud in the First degree, a class E felony, one count
  • Conspiracy in the Fourth Degree, a class E felony, one count
  • Falsifying Business Records in the First Degree, a class E felony, five counts

 
IBT MEDIA, A.K.A. NEWSWEEK MEDIA GROUP
New York, New York
 
Charged:

  • Money Laundering in the Second Degree, a class C felony, two counts
  • Scheme to Defraud in the First Degree, a class E felony, one count
  • Conspiracy in the Fourth Degree, a class E felony, one count
  • Falsifying Business Records in the first degree, a class E felony, four counts

 
CHRISTIAN MEDIA CORPORATION
New York, New York
 
Charged:

  • Money Laundering in the Second degree, a class C felony, two counts
  • Scheme to Defraud in the First degree, a class E felony, one count
  • Conspiracy in the Fourth Degree, a class E felony, one count
  • Falsifying Business Records in the First Degree, a class E felony, one count
  • Criminal Contempt in the Second Degree, a class E felony, one count

 
OIKOS NETWORKS
New York, New York
 
Charged:

  • Money Laundering in the Second Degree, a class C felony, three counts
  • Scheme to Defraud in the First Degree, a class E felony, one count
  • Conspiracy in the Fourth Degree, a class E felony, two counts