BRIAN KIM and LIQUID CAPITAL Accused of Stealing From At Least 45 Victims
Manhattan District Attorney Cyrus R. Vance, Jr. today announced the indictment of BRIAN KIM, 35, for running a Ponzi scheme that resulted in the theft of more than $4 million from at least 45 victims. Both KIM and his hedge fund, LIQUID CAPITAL MANAGEMENT, LLC (“LIQUID CAPITAL”), were indicted on charges of Grand Larceny in the First and Second Degree, Scheme to Defraud, Falsifying Business Records in the First Degree and felony violations of the Martin Act (New York State’s securities fraud statute).[1]
“The defendant induced his clients to make risky and speculative investments by portraying himself as an accomplished trader and money manager,” said District Attorney Vance. “This is just the latest example of our need for stronger legislation to prosecute these types of financial crimes, including a strengthened Martin Act, which will help deter fraudulent conduct and protect investor trust.”
According to documents filed in court, KIM first began operating this scheme while based in Manhattan beginning in approximately January 2003. By portraying himself as an accomplished trader and money manager, KIM induced members of the technology industry, and other professionals, to invest in what the defendant promised were safe, stable, and consistently profitable securities. Instead, KIM diverted vast amounts of money to himself while also generating enormous financial losses in trades of highly speculative futures contracts. To conceal his scheme, KIM created fake monthly performance statements for individual investors showing fictitious account balances with inflated gains that concealed actual trading losses.
KIM is currently a fugitive. In late 2009, KIM was indicted a Manhattan Grand Jury in a separate case on charges of Grand Larceny and Forgery. In that case, KIM is accused of stealing $430,000 in June 2008 from the Christadora House, a condominium complex where KIM resided. KIM failed to appear in New York State Supreme Court for trial on January 4, 2011, and a bench warrant was issued for his arrest.
The United States Commodity Futures Trading Commission (“CFTC”), has today also filed an enforcement action against KIM and LIQUID CAPITAL.
This investigation was conducted by Assistant District Attorneys Harold J. Wilson and Edward M. Burns of the Major Economic Crimes Bureau, who handled the case under the supervision of Deputy Bureau Chief Adam Miller, Bureau Chief Richard Weber, and Executive Assistant District Attorney Adam S. Kaufmann, Chief of the Investigation Division. Trial Preparation Assistants James MacFadyen, Jennie Sirignano and Peter Shakro assisted in this investigation, along with Supervising Investigator Santiago Batista.
District Attorney Vance thanked the CFTC, specifically Manal Sultan, Chief Trial Attorney, Nathan B. Ploener, Senior Trial Attorney, Lara Turcik, Trial Attorney, and Investigators Judith Slowly and Christopher Giglio.
CFTC Regional Counsel Stephen J. Obie and Deputy Regional Counsel Lenel Hickson, Jr., also provided assistance.
Defendant Information:
BRIAN KIM, D.O.B. 3/25/1975
Address Unknown
Charges:
Grand Larceny in the First Degree, Class B felony, 1 count
Grand Larceny in the Second Degree, Class C felony, 1 count
Scheme to Defraud in the First Degree, Class E felony 1 count
Violation of the General Business Law (Martin Act), Class E felony 2 counts
Falsifying Business Records in the First Degree, Class E felony 21 counts
A class B felony is punishable by up 25 years in prison, a class C felony is punishable by up to 15 years in prison, a class E felony is punishable by up to 4 years in prison.
[1] The charges in this indictment are merely allegations and the defendants are presumed innocent unless and until proven guilty.
Manhattan District Attorney Cyrus R. Vance, Jr. today announced the indictment of BRIAN KIM, 35, for running a Ponzi scheme that resulted in the theft of more than $4 million from at least 45 victims. Both KIM and his hedge fund, LIQUID CAPITAL MANAGEMENT, LLC (“LIQUID CAPITAL”), were indicted on charges of Grand Larceny in the First and Second Degree, Scheme to Defraud, Falsifying Business Records in the First Degree and felony violations of the Martin Act (New York State’s securities fraud statute).[1]
“The defendant induced his clients to make risky and speculative investments by portraying himself as an accomplished trader and money manager,” said District Attorney Vance. “This is just the latest example of our need for stronger legislation to prosecute these types of financial crimes, including a strengthened Martin Act, which will help deter fraudulent conduct and protect investor trust.”
According to documents filed in court, KIM first began operating this scheme while based in Manhattan beginning in approximately January 2003. By portraying himself as an accomplished trader and money manager, KIM induced members of the technology industry, and other professionals, to invest in what the defendant promised were safe, stable, and consistently profitable securities. Instead, KIM diverted vast amounts of money to himself while also generating enormous financial losses in trades of highly speculative futures contracts. To conceal his scheme, KIM created fake monthly performance statements for individual investors showing fictitious account balances with inflated gains that concealed actual trading losses.
KIM is currently a fugitive. In late 2009, KIM was indicted a Manhattan Grand Jury in a separate case on charges of Grand Larceny and Forgery. In that case, KIM is accused of stealing $430,000 in June 2008 from the Christadora House, a condominium complex where KIM resided. KIM failed to appear in New York State Supreme Court for trial on January 4, 2011, and a bench warrant was issued for his arrest.
The United States Commodity Futures Trading Commission (“CFTC”), has today also filed an enforcement action against KIM and LIQUID CAPITAL.
This investigation was conducted by Assistant District Attorneys Harold J. Wilson and Edward M. Burns of the Major Economic Crimes Bureau, who handled the case under the supervision of Deputy Bureau Chief Adam Miller, Bureau Chief Richard Weber, and Executive Assistant District Attorney Adam S. Kaufmann, Chief of the Investigation Division. Trial Preparation Assistants James MacFadyen, Jennie Sirignano and Peter Shakro assisted in this investigation, along with Supervising Investigator Santiago Batista.
District Attorney Vance thanked the CFTC, specifically Manal Sultan, Chief Trial Attorney, Nathan B. Ploener, Senior Trial Attorney, Lara Turcik, Trial Attorney, and Investigators Judith Slowly and Christopher Giglio.
CFTC Regional Counsel Stephen J. Obie and Deputy Regional Counsel Lenel Hickson, Jr., also provided assistance.
Defendant Information:
BRIAN KIM, D.O.B. 3/25/1975
Address Unknown
Charges:
Grand Larceny in the First Degree, Class B felony, 1 count
Grand Larceny in the Second Degree, Class C felony, 1 count
Scheme to Defraud in the First Degree, Class E felony 1 count
Violation of the General Business Law (Martin Act), Class E felony 2 counts
Falsifying Business Records in the First Degree, Class E felony 21 counts
A class B felony is punishable by up 25 years in prison, a class C felony is punishable by up to 15 years in prison, a class E felony is punishable by up to 4 years in prison.
[1] The charges in this indictment are merely allegations and the defendants are presumed innocent unless and until proven guilty.
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