Civic Volunteer a Wanted Man

Financier Kyung Joon Kim, a wanted man in South Korea, didn’t exactly live in hiding upon arriving back in Los Angeles.

South Korean authorities had issued an arrest warrant for him in August 2002 and again in August 2003 for allegedly masterminding a $30-million investment fraud in his native land.

Nonetheless, Kim organized venture-capital conferences, lived in a $3.2-million Beverly Hills home and, last September, was appointed by Mayor James K. Hahn to the city’s Industrial Development Authority.

Federal authorities arrested Kim last week. He is being held pending a hearing on whether he should be extradited to South Korea to stand trial.

The charges against the Ivy League-educated Kim, 37, have generated big headlines in Seoul because of the size of the alleged fraud and the fact that several prominent figures are involved. Seoul Mayor Myung Bak Lee has publicly claimed that he was one of the victims of Kim’s alleged schemes.

Some Korean American leaders in Southern California expressed concern that Kim’s arrest would hurt the community’s image at a time when they are trying to play a bigger role in local government.

“We are finally getting a few appointments here and there, and this thing happens -- and it really kills it all,” said Sukhee Kang, president of the Korean American Coalition of Orange County.

A spokesman for Hahn said Friday that Kim was removed from the Industrial Development Authority board on Tuesday, immediately after the mayor’s office learned of the charges. The authority provides tax-exempt financing to businesses and nonprofit organizations.

Kim, who is a U.S. citizen, approached the mayor’s staff last year to express his interest in becoming a “volunteer member of the city family,” said Hahn spokesman Yusef K. Robb. Kim did not deal directly with Hahn, Robb said.

“We do conduct background checks. However, no system is perfect,” Robb said, citing the fact that the charges were based in Korea. “This is an isolated incident and we will continue to welcome large and diverse groups of Los Angeles residents to take an active part in the operation of the city government. “

Born in South Korea, Kim moved with his family to Los Angeles when he was 5. His parents ran a liquor store.

Kim was educated at Cornell University and received advanced degrees at the University of Chicago and the Wharton School of Economics. He eventually returned to South Korea, working as an investment executive. It was during that time -- in 2000 and 2001 -- that the alleged fraud occurred, according to the complaint filed by Assistant U.S. Atty. John E. Lee.

Using a corporate charter issued by Nevada, Kim allegedly created 19 fake entities, made seven counterfeit U.S. passports and used them to establish foreign corporations and open stock and security accounts, the complaint said.

South Korean authorities accuse him of embezzling about $32 million from Optional Ventures Korea Inc., of which he was chief executive, to pay personal debts and transfer funds through overseas accounts, the complaint said.

Kim and his wife, Bora Lee, moved back to the United States on Dec. 20, 2001, before South Korean authorities issued an arrest warrant, the complaint said.

According to court papers filed by the U.S. attorney’s office, South Korean judges issued arrest warrants for Kim in 2002 and 2003. Prosecutors there began working with the U.S. government to get Kim extradited.

But it appeared that few people in Los Angeles knew Kim was a wanted man.

With his wife and sister, Kim purchased properties in Beverly Hills valued at $6.7 million, according to court documents. They paid $5.6 million in cash, the records say.

Kim continued to work as a venture capitalist, but the exact nature of his work was unclear.

Mark E. Beck, an attorney representing Kim, said his client’s activities in Los Angeles show that he was “anything but a fugitive.”

“How many so-called fugitives do you know who become civic leaders in a media-saturated community?” Beck said. “It would have taken nothing more than a walk through the telephone directory to find him, and anyone who wished to know where he was knew where he was.”

Beck said he would urge a federal judge on Monday to release Kim on bail so he can prepare his defense. “This case is the product of politics,” the attorney said, declining to elaborate.

In recent days, Kim’s sister also has become embroiled in the controversy. Erica M. Kim is a Koreatown attorney, a member of the Los Angeles Human Relations Commission and president of the Korean American Chamber of Commerce.

On Wednesday, the company Kyung Joon Kim is accused of defrauding filed suit in U.S. District Court against him, his sister, his wife and others. The suit claims all of them were involved in the scam.

Erica Kim did not return calls seeking comment.

Despite concerns about how the case might affect the Korean American community’s image at City Hall, Hahn’s spokesman said he didn’t see any change.

“By no means will this isolated incident affect the mayor’s positive view of the Korean community and its contributions to Los Angeles,” Robb said.