A Milton, Washington man who owned a Federal Way Korean bar where
Korean National women were promoted for prostitution was sentenced today
to 72 months in prison and five years of supervised release, announced
U.S. Attorney Jenny A. Durkan. Chang Young Kim, 59, was also ordered to
pay $112,050 in restitution and over $1.6 million in back taxes and
penalties to the Internal Revenue Service. Kim pleaded guilty in
November 2012 to conspiracy to transport individuals for prostitution,
conspiracy to engage in money laundering, bribery of a public official,
and tax evasion. Kim owned the Blue Moon Korean bar business in Federal
Way, which utilized Korean national women working illegally as “bar
girls” and prostitutes. Kim was indicted in three separate criminal
schemes, some related to the club and others to fraudulent business
dealings. At sentencing, U.S. District Judge Ronald B. Leighton said to
the defendant, “You were a one-man criminal enterprise...[and] the most
instrumental of everyone on a host of fronts.”
During 2010 and 2011, Kim owned the Blue Moon using “madam” Miyoung
Roberts, 42, of Auburn, Washington, to recruit and manage more than two
dozen “bar girls” and arrange their transportation from Korea to the
U.S. Kim and his co-defendants arranged apartments for the women to live
in and supervised some of the women’s prostitution activities. During
the undercover investigation by law enforcement, Kim offered and paid
$15,000 to a Washington State Liquor Control Board investigator,
believing the investigator was corrupt and that he was getting advance
warning of inspections. The investigator was reporting the bribes as
part of the undercover investigation.
In a separate scheme, Kim convinced two clients of his real estate
company, Royal Realty, to invest $400,000 in the purchase of a Cle Elum,
Washington motel. However, there was no deal to purchase the property,
and Kim and two co-conspirators used the money for their own expenses.
Finally, Kim attempted to evade more than $1.6 million in income taxes
by failing to report income and by putting assets in other people’s
names.
In asking for a significant sentence, prosecutors wrote to the court
that Kim “has spent a good part of his adult life steeped in fraud and
deception....In order to commit these crimes, the defendant was willing
to use his family members to further his personal objectives, causing
them to place themselves in financial and legal jeopardy. He was willing
to violate the law through bribery....It is as though the defendant had
no limits as to how far he would go to lie, cheat, and steal.”
“Kim operated a sex club a few blocks away from homes and schools,
degrading the quality of life in the community as well as the women
involved,” said Brad Bench, Special Agent in Charge of HSI Seattle. “HSI
will continue to work closely with its law enforcement partners to
attack and dismantle these kinds of enterprises that prey on the
vulnerable and often bring other criminal activity into the area.”
“Our communities deserve better than to have human trafficking going
on in them,” said Kenneth J. Hines, Special Agent in Charge of
IRS-Criminal Investigation in the Pacific Northwest. “IRS special agents
bring their unique skills in conducting financial investigations,
ranging from tax evasion to money laundering, to the team of law
enforcement professionals working to erase this type of crime from our
region.”
The case was investigated by U.S. Immigration and Customs
Enforcement’s Homeland Security Investigations (HSI), the Internal
Revenue Service Criminal Investigation (IRS-CI), the Washington State
Liquor Control Board (WSLCB), the Federal Way Police Department,
Lakewood Police Department, and the Federal Bureau of Investigation.
The case was prosecuted by Assistant United States Attorney Ye-Ting Woo.
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