Several foreign investors sued Los Angeles-based attorney and money manager, Justin Moongyu Lee, after finding out their money was not being used to secure entry to the United States through the government’s EB-5 visa program. Now, investors also are suing the bank where Mr. Lee kept investors’ funds for related to the EB-5 Fraud.
Several Korean nationals are suing Wilshire Bank for fraud, negligence, and breach of contract, claiming that the bank should have recognized Mr. Lee’s fraudulent activities and stopped him from furthering his scheme.
According to investors, Wilshire Bank had a long relationship with Lee, including employing a relative – information that was never disclosed. Investors are also alleging that because of Lee’s close ties to the bank, he was able to improperly transfer money out of investors’ escrow accounts.
As far back as 2006, Lee told his investors that their money would be used to build biofuel plants in Kansas and Texas. When the market tanked and clients did not receive their green cards, the lawsuits began piling up starting in 2010.
The California Bar Association instituted disciplinary proceedings against Lee in 2013, and he was sued by both the SEC and Justice Department in 2014. According to the Justice Department, Lee used some of the money he received to pay back earlier investors from another failed venture instead of putting it into biofuel plants.
Investors believe the bank should have prevented this misappropriation of funds by safeguarding their escrow accounts. Instead, their money was transferred out of escrow in random sums while the investors awaited their preliminary check with the U.S. Customs and Immigrations Services.
Call a Los Angeles Securities Fraud Attorney Today
If you invested with Mr. Lee or Wilshire Bank and are a victim of EB-5 Fraud you may have certain legal rights that require your immediate attention.
Contact an experienced Los Angeles securities fraud attorney today for a consultation to discuss your rights and options.