China's Brilliance Ex-CEO Bilking Billions for U.S. Auto Factory Scam?

If it sounds too good to be true, someone somewhere is scamming someone somewhere. This morning’s story in Automotive News [AN, sub] would almost have us believe that former Brilliance automotive CEO Yang Rong is “leading a venture to build a $6.5 billion auto plant in northern Mississippi, where he would hire 25,000 workers to eventually produce 1 million cars a year.” ‘Cause, you know, the U.S. market has room for another mainstream automotive brand. To its credit, AN sees a few problems with the concept: “It would be easy to dismiss his proposal out of hand. The plan has no brand, products or retail network. But Yang oversaw a rise from nowhere in Brilliance’s fortunes in the 1990s, and he has been attracting money from some of China’s wealthy residents.” The last part of that statement is the most credible; and it doesn’t bode well for anyone gullible enough to invest in Rong’s visionary vehicles. Oh, and Uncle Sam’s part of the scam . . .

Vincent Wang, Yang’s associate and one of three key project players with the name Wang, spoke with Automotive News on behalf of Yang because of the industrialist’s limited English. Wang said the project will attract auto investors through a special U.S. visa program called EB-5. That program, created in 1990, encourages wealthy foreigners to invest in the United States.

A commercial investment of $1 million, or $500,000 if made in an economically distressed area such as northern Mississippi, qualifies a foreign family for a permanent-resident green card. “A lot of people in China want to move some of their money out of China,” Wang said.

There’s a lot of history behind Mr. Rong; none of it would lead you to believe that your money would be safe in his hands. In short, if loving Rong is right, I don’t want to right.