LAWFUEL – Law News Network – A New Jersey couple who operated a $3 million “bust-out” scheme in the Koreatown section of Los Angeles have been sentenced to lengthy federal prison terms for their convictions on federal fraud charges.
Mi Suk Yi, 39, was sentenced this afternoon to 97 months in prison. At a hearing yesterday afternoon, Yi’s husband, Paul Amorello, 49, was sentenced to 135 months in prison.
Both defendants were sentenced by United States District Judge Christina A. Snyder, who ordered the defendants collectively to pay $3,768,906 in restitution to the banks who were defrauded. At Yi’s sentencing hearing today, Judge Snyder said, “The offenses were reprehensible, with numerous victims who suffered great losses.”
Yi and Amorello, both of Saddle River, New Jersey, operated a wide-ranging fraud scheme in which they defrauded multiple banks out of millions of dollars and then laundered more than $1.2 million of the funds. They eventually used the money to purchase two homes in New Jersey, both of which are in the process of being forfeited to the government. From April 2000 until December 2002, Yi and Amorello exploited loopholes in the banks’ credit line programs to obtain the money and then created fake identities to hide and launder the money.
At trial last year, a federal jury in Los Angeles convicted the defendants of conspiracy and 12 counts of bank fraud. Yi was also found guilty of furnishing false information to the Commissioner of Social Security and 11 counts of money laundering. Amorello was also found guilty of misusing a social security number, structuring a transaction to avoid the requirement that cash transactions of more than $10,000 be reported to the government and six counts of money laundering.
The bank fraud charges related to a scheme that cost Bank of America, Wells Fargo Bank and other major banks millions of dollars. Yi and Amorello manipulated business and home equity lines of credit extended by the banks. Yi and Amorello accessed the lines of credit, which had been obtained by others, and then paid down the balances with worthless, insufficient-funds checks. After paying down the balances, the defendants quickly drew cash from the line of credit accounts before the payment checks bounced. When the checks bounced, the balances on the lines of credit shot up over the maximum limits, resulting in losses to the banks.
Yi and Amorello drove from New Jersey to California to perpetrate the fraud, which was centered in the Koreatown section of Los Angeles. In April 2000, Yi obtained a Social Security number in a false identity by providing a false Korean passport and a false U.S. immigration document to a Social Security Administration office in Oxnard. Over the next two years, Yi and Amorello obtained false driver’s licenses from California and Arizona, using three false identities.
Yi and Amorello solicited Korean and Korean-American credit-holders by placing advertisements in local Korean-language newspapers. The ads claimed that Yi and Amorello could help people with a large amount of debt. In some cases, Yi and Amorello promised higher credit lines and then demanded fees from credit-holders. In other cases, Yi and Amorello obtained blank checks from people and used those checks to make payments on lines of credit held by others.
Yi and Amorello took most of the proceeds of the bust-out scheme and laundered them through bank accounts they had opened under the three false identities at numerous banks in Los Angeles and on the East Coast. In order to avoid detection, Yi and Amorello deposited the cash into these bank accounts in amounts less than $10,000. Ultimately, Yi and Amorello returned to their home state of New Jersey and bought two luxury homes with the cash. The total purchase price of both homes was almost $2 million, and Yi and Amorello put down more than $1.2 million of the fraud proceeds towards the homes.
Yi and Amorello were arrested in New Jersey on April 11, 2003, and they have been in custody ever since.
The investigation in this case was conducted by the United States Secret Service and the United States Postal Inspection Service.
CONTACT: Assistant United States Attorney Jeremy D. Matz
Assistant United States Attorney Matthew E. Sloan