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Hedge Fund wipeout in Florida
MIAMI - Dozens of wealthy investors were scammed out of $160 million by three self-proclaimed hedge fund operators who set up flashy offices in Palm Beach County, took their money and ran, federal investigators said.
Now, months after authorities became suspicious, two of the three partners have fled the country, and the third isn't answering questions from investigators.
Most of KL Financial's 200 clients were men of retirement age. Gary Klein, a lawyer representing dozens of them, told The Miami Herald that he has clients who lost everything.
The SEC has filed a formal complaint accusing KL Financial of misrepresenting the fund's performance and possibly misappropriating money. A federal court has frozen the company's assets.
Mike Tein, one of KL's court-appointed receivers, said the three men directly received $20 million during their six-year reign at KL, spending lavishly on million-dollar homes, exotic sports cars and frequent trips to Las Vegas.
Within 24 hours of a surprise visit to a KL Financial office in California in February by SEC investigators, Won Lee, 34, reportedly cashed in frequent-flier miles for a one-way ticket to South Korea. Investigators have not heard from him since.
Another partner, Yung Kim, 34, vanished a day later, but answered a surprised investigator's cell phone call weeks later. The line went dead after Yung was asked where he was, and authorities haven't heard from him since, Tein said.
Chief trader John Kim, 36, remains in Florida and has promised to cooperate with investigators. But during a March 11 deposition, John Kim asserted his Fifth Amendment right to avoid self-incrimination to each of 195 questions.
His attorney, Gregory C. Ward, said in a March 16 motion that Lee and Yung Kim were to blame for losing the firm's money "without John Kim's knowledge or participation
MIAMI - Dozens of wealthy investors were scammed out of $160 million by three self-proclaimed hedge fund operators who set up flashy offices in Palm Beach County, took their money and ran, federal investigators said.
Now, months after authorities became suspicious, two of the three partners have fled the country, and the third isn't answering questions from investigators.
Most of KL Financial's 200 clients were men of retirement age. Gary Klein, a lawyer representing dozens of them, told The Miami Herald that he has clients who lost everything.
The SEC has filed a formal complaint accusing KL Financial of misrepresenting the fund's performance and possibly misappropriating money. A federal court has frozen the company's assets.
Mike Tein, one of KL's court-appointed receivers, said the three men directly received $20 million during their six-year reign at KL, spending lavishly on million-dollar homes, exotic sports cars and frequent trips to Las Vegas.
Within 24 hours of a surprise visit to a KL Financial office in California in February by SEC investigators, Won Lee, 34, reportedly cashed in frequent-flier miles for a one-way ticket to South Korea. Investigators have not heard from him since.
Another partner, Yung Kim, 34, vanished a day later, but answered a surprised investigator's cell phone call weeks later. The line went dead after Yung was asked where he was, and authorities haven't heard from him since, Tein said.
Chief trader John Kim, 36, remains in Florida and has promised to cooperate with investigators. But during a March 11 deposition, John Kim asserted his Fifth Amendment right to avoid self-incrimination to each of 195 questions.
His attorney, Gregory C. Ward, said in a March 16 motion that Lee and Yung Kim were to blame for losing the firm's money "without John Kim's knowledge or participation
