Federal prosecutors want to freeze the assets of embattled GenPhar owner Jian-Yun Dong and his biotech company to make sure the government can recoup some $3.6 million in grant money he is accused of stealing.
Prosecutors are seeking a restraining order to keep Dong and his Mount Pleasant company from transferring or disposing of cash and property ahead of his upcoming trial on federal fraud and theft charges.
In court papers, prosecutors cited Dong's recent transfer of two 40-acre tracts in Alabama to his daughter's name.
Dong said he transferred that property to his daughter to ensure that she had money to pay for college. Prosecutors noted, however, that Dong's daughter already had nearly $260,000 in assets at her disposal.
Dong said he intends to fight the government's request, insisting that it is part of a witch hunt against him. He insists prosecutors are trying to financially hobble him and destroy his disease-fighting firm over what he considers to be harmless errors and bookkeeping issues.
“They are trying to take away my means to defend myself and shut down my company, killing jobs, before even allowing a chance for due process to take place,” Dong said Tuesday. “This is persecution, not prosecution.”
Assistant U.S. Attorney Beth Drake declined to comment on Dong’s assertions, saying prosecutors have a policy against discussing pending cases.
Dong, 54, is accused of fraudulently diverting money intended for research on vaccines for the deadly Ebola and Marburg viruses. A 36-count indictment, unsealed in September, alleges that he used that money to pay for lobbying, construction on GenPhar’s new $33 million headquarters on Morgan Point Road and other unallowed expenses.
A new, superseding indictment names GenPhar as a defendant in the criminal case, further clouding the company’s future.
The indictment also accuses Dong of trying to hide from his employers at the Medical University of South Carolina the amount of federal grant money he was taking in and shield his ownership of Vaxima Inc., a shell company he allegedly created to divert federal money to his own use.
Dong also faces a new charge of lying to federal agents in a separate case involving illegal campaign contributions.
In that case, Dong and his estranged wife, 52-year-old scientist Danher Wang, are accused of using foreign money and proxies to help funnel $31,000 to U.S. Sen. Lindsey Graham’s campaign and his political action committee, Fund for America’s Future. Dong faces a witness-tampering charge in that case as well.
The two cases are expected to go to trial early next year, with jury selection scheduled for Jan. 11 in Charleston. Dong said he doubts that it will happen that soon, as he and his attorney, assistant federal public defender Ann Briks Walsh, are still waiting on prosecutors to share their evidence against him.
“I would like to go forward in January,” he said. “They have no evidence whatsoever.”
A judge appointed Walsh to represent Dong last month, after Dong kept showing up for court hearings without having hired an attorney.
Dong and others have said his estranged wife has positioned herself to become the government’s star witness in the case against him. He said Tuesday that he is not sure which way she will go at this point.
Wang’s attorneys, Max Nathan Pickelsimer and Sherri A. Lydon, did not return emails seeking comment on the case.
At this point, Dong said, he is ready for prosecutors to take their best shot. The case has been a drag on his reputation and has effectively sidelined important research that stood to bring more than $10 million in grant money into South Carolina, he said.
“I still have faith in the justice system,” he said. “And I don’t believe I did anything wrong.”