SEATTLE (AP) — A Washington man who once served time in prison for defrauding his neighbor out of about $800,000 has been arrested again — this time along with his wife, after authorities said they tricked investors out of hundreds of thousands of dollars, if not more.
Sung “Laurence” Hong and his wife, Hyun Joo “Grace” Hong, were arrested Friday on wire fraud charges.
They made initial appearances in federal court later in the day and were scheduled to face detention hearings Tuesday. Attorneys for the couple made no comment on the allegations.
Prosecutors said the Hongs lied about their investment credentials and failed to disclose Hong’s 2007 fraud conviction as they solicited millions of dollars in purported investments, largely from members of religious organizations, since 2011.
Much of the money the couple simply lost trading, but they used some of it on a 9,000-square-foot mansion in Clyde Hill, east of Seattle; a 45-foot yacht; and on luxury vehicles including a Lamborghini, an FBI agent wrote in a criminal complaint.
Among the evidence cited in the complaint is a YouTube video of the Hongs speaking to a religious conference last year in Lancaster, California.
In it, Grace Hong claims — falsely, prosecutors said — to have worked at Deutsche Bank before she and her husband decided to use their talents to help Christians.
“The desires in my heart was always saying, ‘How can I glorify His kingdom?'” she says in the recording. “I thought, ‘The right Christian way is make money and give back to His church.'”
One California church invested $1 million and lost about $300,000 on a single trade, authorities said, and the Hongs withdrew about $150,000 of it as “advisor fees.”
Sung Hong was arrested by federal agents for investment fraud in 2007 after an Associated Press story detailed how he had cheated his neighbor in Kirkland out of $800,000.
Hong was sentenced to nearly three years in prison and ordered to pay more than $925,000 to the neighbor and to a family he met at a Bellevue church and subsequently defrauded.
“About the only positive thing I can find (to say) about Mr. Hong is that he may have a gambling problem,” U.S. District Judge James L. Robart said during that sentencing hearing.
Hong apologized and vowed to repay what he stole, but investigators say he still owes $794,000.