On August 13, 2025, California’s Department of Financial Protection and Innovation (DFPI) issued a desist and refrain order against Shao Bank (operating under Shao Limited, Shao Global Future Limited, and Global Future Enterprise Group), prohibiting the entity from offering or selling unqualified securities in California, per. The order, effective immediately, cites violations of the California Corporate Securities Law (CSL) under Corporations Code section 25110, as Shao Bank sold investment contracts and bonds via its website since early 2023 without DFPI qualification or exemption, per. The DFPI emphasized that Shao Bank falsely claimed to offer banking services, deposits, mortgage/consumer/business loans, and insurance policies, despite not being a licensed bank, per.
Shao Bank, launched in late 2023 and gaining traction in late 2024, functioned as an MLM crypto Ponzi scheme promising high returns through fake bank bonds and AI-powered trading, per. Fronted by a fictitious CEO “Richard Bates”—portrayed by an actor with an Eastern European accent in promotional videos—the scheme targeted global investors, with traffic suggesting Russian/Ukrainian/Belarusian origins, per. It collapsed in May 2024, coinciding with a pyramid fraud alert from Russia’s Central Bank in December 2023, per. The Hong Kong shell company behind it masked operations, but DFPI’s order addresses unlicensed securities sales in California, per.
The DFPI’s action is part of a broader crackdown, including simultaneous orders against Fintoch, Beonbit, Optimus VIP, and Crypto Wealth Coach (CWC)/Seth Mani, for similar crypto schemes, per. This reflects heightened state-level scrutiny amid federal delays, like the SEC’s postponement of XRP ETFs to October 2025, per. Bitcoin (BTC) ($117,286) and Ethereum (ETH) ($4,461) remain stable, per CoinMarketCap, but the order underscores risks in unregulated MLM investments, potentially boosting institutional adoption of compliant assets like USDC, per. X posts from @CaliforniaDFPI urge victims to file complaints at dfpi.ca.gov/submit-a-complaint, per.
Victims should report to DFPI at dfpi.ca.gov or the FBI via ic3.gov, per. Verify platforms through DFPI’s enforcement database at dfpi.ca.gov/rules-enforcement/actions_and_orders, per. Diversify into USDC or ETH with stop-losses below BTC’s $112,000, per TradingView. Follow @TheBlock__ on X for updates. Shao Bank’s collapse, like PGI Global’s $198M fraud, signals escalating enforcement, potentially reducing scams but increasing compliance costs for legitimate DeFi projects by 2026, per.
