However, Ziyang Shen, a certified financial planner serving the Toronto Chinese Community for eight years, said new immigrant investors have to do their homework before making any investment.
"You have to have enough investment knowledge and understand how much risk you can take," Shen told Xinhua.
For middle-class investors, their expected returns are about eight to ten percent annually, he said, "higher returns sometimes mean higher risk."
"An investor should always ask for a monthly, quarterly, semi-annual or at least an annual report about their money status no matter how high the returns are," he said.
Asad Khan, another Toronto financial adviser, said Tang's self-portrait as "the Chinese Warren Buffett" and "the king of one-percent weekly returns" is an "oxymoron."
"Warren Buffett's style is always going for long and steady win, something of low risk," Khan said. "However, Tang's one-percent weekly returns mean more than 50 percent increase annually. The double-digit return is typically high risk investment."
Khan, who is of Pakistani origin, said that new immigrants, not particularly Chinese, tend to have deeper trust in members from their own ethnic group.
"Unfortunately, sometimes such trust has been abused and led to the investment fraud such as the case of Salim Damji. He conned 4, 000 members of Toronto's tight-knit Ismaili community," he said.
Damji pleaded guilty to fraud in 2002 and was sentenced to seven and a half years in prison. The victims are still suing the Bank of Montreal for its loose supervision on Damji's extraordinary deposits from the scam.
The Damji's scam was among the largest in Canadian history. Investors were told that they were being given first priority since they were the members of the community and relatives of Damji. They gave the scam artist their life savings to invest into a tooth-whitening product that Damji was never authorized to get involved with.
(China Daily April 16, 2009)
