Monday, December 21, 2009
Former Florida Hedge Fund Manager Sentenced In $200 Million Swindle
Won Sok Lee, formerly of Singer Island, Florida, was sentenced to 298 months in prison (nearly 25 years) for his role in defrauding investors out of nearly $200 million in connection with the collapse of KL Group, LLC, the hedge fund firm he operated with co-conspirators Jung "John" Kim, and Yung Bae Kim. Lee, pictured on the left, was also ordered to pay $78,525,567.34 in restitution. The three were originally indicted in December 2006 for allegedly defrauding more than 250 investors out of $194 million over a five year period between 2000 and 2005. Lee was a fugitive from the time of his indictment until early 2009 when federal authorities located him in South Korea. He was extradited to Florida to face fraud charges in April 2009 . According to the indictment, KL Group co-conspirators put on an elaborate scam to lure investors and their money, including lavish offices overlooking the Atlantic Ocean and paying a large group of "prospective traders'' to stay on the phones in the office and trade stocks even though they were losing money to make the business appear to customers to have a large and successful staff of stock traders. Lee plead guilty in September and the Kim brothers plead guilty in 2007.
Read the DOJ announcement here.