Korean National Pleads Guilty To East Bay-Based Foreign Exchange Trading Scam

OAKLAND – Jin K. Chung pleaded guilty in federal court in Oakland to money laundering, announced United States Attorney David L. Anderson and Federal Bureau of Investigation Special Agent in Charge John F. Bennett.  The plea was accepted by the Honorable Jeffrey S. White, U.S. District Judge. 

According to his plea agreement, Chung, 56, of Seoul, Korea, admitted he laundered money he obtained from a foreign exchange trading scam.  Chung admitted that in 2003, he and codefendant Peter Son, 47, of Portland, Ore., started two companies, SNC Asset Management, Inc. and SNC Investments, Inc., both headquartered in Pleasanton, Calif.  Chung admitted he falsely advertised both companies as highly successful in foreign exchange trading.  Further, Chung promised potential investors they would receive annual investment returns of between 24% and 36%.  Chung knew that these representations were false and made with the intention of attracting individuals to invest in the two companies.  Chung acknowledged that hundreds of investors opened accounts and deposited money into the two companies based upon the fraudulent representations.  

Chung and Son deposited the clients’ funds into bank accounts that the defendants controlled.  While directing employees of the companies to send monthly statements to the investors that falsely reported accrued earnings, Chung regularly cashed checks or arranged wire transfers in amounts over $10,000 for his own benefit.  Chung also transferred funds from the accounts to pay purported investment returns and redemptions to investors, to pay sales commissions and other expenses related to the scheme.  

By October 2008, the defendants depleted the funds in the companies' accounts and closed both businesses without advance notice to employees or clients.  Chung admitted that in the four months before closing the businesses, he transferred more than $630,000 from the businesses into his personal accounts.

In the aggregate, at least 400 victims invested and lost approximately $60,300,000 in the trading scheme during Chung and Son’s operation of SNC Asset Management, Inc. and SNC Investments, Inc.

On July 8, 2019, Chung was charged by information with a single count of engaging in monetary transactions in property derived from specified unlawful activity (money laundering), in violation of 18 U.S.C. § 1957.  On Tuesday, September 3, 2019, Chung pleaded guilty to the charge. 

Judge White scheduled Chung’s sentencing hearing for November 19, 2019, at 1:00 p.m. Chung faces a maximum statutory penalty of 10 years in prison and a fine of $250,000, or twice the amount of the criminally derived property involved in the transactions.  The court also may order a term of supervised release, special assessments, forfeiture, restitution, and deportation.  However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

For his part in the scheme, Son pleaded guilty on April 9, 2010, to conspiracy to commit wire fraud and conspiracy to engage in monetary transactions with the proceeds of wire fraud, in violation of 18 U.S.C. §§ 1349 and 1956(h), respectively.  On July 30, 2010, the Honorable D. Lowell Jensen, then-U.S. District Judge, sentenced Son to a prison term of 180 months. 

Assistant U.S. Attorney Jonathan U. Lee is prosecuting the case with the assistance of Jessica Rodriguez Gonzalez.  The prosecution is the result of an investigation by the Securities and Exchange Commission, U.S. Commodities Futures Trading Commission, the FBI, and the IRS.