Federal agents have arrested the former owner of a waterfront mansion in Kirkland on fraud and extortion charges, nearly a year after an...

Share story

Federal agents have arrested the former owner of a waterfront mansion in Kirkland on fraud and extortion charges, nearly a year after an Associated Press report about the man prompted an FBI investigation.

Sung “Lawrence” Hong was arrested without incident in Mill Creek on Friday, FBI spokeswoman Robbie Burroughs said.

Last February, using bank, real-estate and court records, the AP reported that Hong helped pay for his lifestyle — including luxury cars, a 32-foot boat and a multimillion-dollar home on Lake Washington — by bilking $800,000 from his retired next-door neighbor.

The activity was a pattern: As Hong was taking Wayne Seminoff’s money, members of a Bellevue church were fighting in court to get back $340,000 they had given to Hong, believing he was investing it.

Most Read Stories

Unlimited Digital Access. $1 for 4 weeks.

“I’m very happy to see him punished,” said Seminoff, 63. “I don’t want him to do this to anybody else. He really got me bad.”

Burroughs said a copy of the complaint detailing the two charges against Hong was not immediately available, but the counts fell under wire-fraud and extortion laws. A voice-mail message left for Hong was not immediately returned, and his former lawyer did not return a call seeking comment.

Hong’s home, where he lived with his wife and mother, was foreclosed last month. He was arrested as he moved out on Friday, Seminoff said. Real-estate records showed that Hong bought the 4,400-square-foot home for $3.2 million in 2004.

Seminoff’s involvement with Hong began after Seminoff moved into an apartment next door in 2005. Hong quickly befriended the older man, taking him boating and inviting him over for kim chee, a spicy Korean cabbage dish.

Seminoff said Hong, then 33, introduced himself as an investor in stocks, bonds and futures. As they became closer friends, Hong suggested they make an investment together.

Seminoff agreed, and tried to protect his investment by writing out a contract: They’d match contributions, split the profits, and Hong would invest the money in such a way as to limit losses to 10 percent. If Hong failed to follow the terms, he would refund Seminoff’s money.

Hong signed the agreement, and Seminoff turned over half of the cash he had accessible: $50,000.

Over the next several months, Hong spun a series of stories explaining why he needed more money: His father-in-law was the finance minister of South Korea; he had connections to billionaire George Soros; they could make a killing if Seminoff could come up with some more money.

Seminoff did. He sold a house in Redmond and invested $250,000 more, but soon was out of cash. He asked Hong for money from the account for living expenses.

Hong refused and began to threaten Seminoff, warning that his connections to Soros turned out to be a powerful international mafia that would kill them — and Seminoff’s daughter — if they tried to get their money back. Hong demanded another $500,000.

Seminoff began to carry an audio recorder when he met with Hong.

In one audio-taped conversation, Hong said: “It’s a slaughterhouse. Whoever that’s associated with me is in danger. … If we make a mistake, Wayne, it’s not just me. It’s other people … The one day you and I think we can outsmart these people, that’s the biggest mistake of our lives.”

Seminoff eventually sued Hong in U.S. District Court in Seattle. A judge froze Hong’s bank account, and eventually Hong agreed to give Seminoff the nearly $300,000 that was left. Hong also turned over two personal watercraft, but Seminoff doesn’t expect to get much more of his money back.

Other cases involving Hong:

• In 1997, Hong and his mother’s accountant, Sukjoo Jay Lee, founded a company called Republic Investments and Securities by each chipping in about $70,000.

The next year, Lee sued Hong in King County Superior Court, saying Hong broke their agreement by engaging in “reckless” day-trading, misrepresented himself as a stock-trading expert, lost $100,000, and tried to embezzle from the account. The case was settled out of court for an undisclosed amount.

• In about 2001, court records show, Hong also began to bilk a Korean-American family and another person he met at Central Presbyterian Church in Bellevue. He settled the case in January 2006 by agreeing to pay those plaintiffs $200,000. It was not immediately known if he had paid off the settlement.