Accused KL Fraudster Gets More Time To Find Lawyer

Apr 10 2009 | 11:59am ET

Like his fellow accused Florida hedge fund fraudster Arthur Nadel, Won Sok Lee has won a delay as he looks for a lawyer.

Lee, a partner in the collapsed West Palm Beach, Fla., hedge fund KL Financial, won a continuance of his arraignment Friday so he can find local counsel. Lee, who fled the U.S. after his indictment in 2006 and was extradited to the U.S. last week after being arrest in South Korea, will be back in court next Friday. Until then, he remains held without bail in federal custody.

Lee was indicted almost two and a half years ago along with two others on 35 counts of conspiracy, mail fraud and money laundering. Prosecutors say that Lee and his partners, brothers Jung Bae Kim, better known as John Kim, and Yung Bae Kim, ripped 250 investors off to the tune of $194 million between 2000 and 2005. The trio allegedly pretended that John Kim was a hugely successful day-trader with a proprietary system that earned triple-digit returns. Authorities say KL sent out bogus account statements showing big profits when, in fact, the firm lost some $30 million it did trade, with Lee and the Kims stealing the rest.

After pleading guilty to the charges, John Kim was sentenced to more than 18 years in prison; his brother, who also pleaded guilty, received more than 6 years.

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