Another ponzi bites the dust. (WSJ)

California financier Danny Pang was arrested by the Federal Bureau of Investigation on charges of structuring cash transactions to keep them under the $10,000 figure that triggers a report to the federal government.

The accusation, though it involves a felony, appears to be a placeholder while federal officials conduct a deeper probe of Mr. Pang’s activities at his Irvine, Calif., investment firm, Private Equity Management Group Inc., or PEMGroup.

Speaking to a former DEA agent friend of mine, “structuring” is a common way the Feds catch drug dealers. Banks will notice someone depositing cash in amounts close to, but always under, $10k so as to avoid reporting requirements. The bank will tip off the feds who then open an investigation.

Apparently, Pang made 38 withdrawals just under the $10k threshold, much of which may have been used to buy gold:

FBI agents also searched Mr. Pang’s Newport Beach, Calif., home on Tuesday. Among the items they apparently were searching for, according to an FBI affidavit filed in federal court in Santa Ana, Calif., was a safe possibly stocked with gold bullion. A former PEMGroup president had told the FBI that Mr. Pang used some of the cash transactions to buy gold that he kept in a safe hidden in his bedroom, the affidavit states, so he would have something to live off of “in the event something bad happened.”

Speaking of Ponzis, John Hempton believes he has a lead on another…