Three people have been arrested and charged in connection with running “high-end brothels” in the Boston area and Northern Virginia whose clients allegedly included military officers and elected officials, the U.S. Attorney’s Office in Massachusetts announced Wednesday.
The charges allegedly stem from a multiyear investigation that began in the summer of 2020 and is ongoing. Prosecutors said the Massachusetts brothels were in Cambridge and Watertown, and the Virginia locations were in Fairfax and Tysons, primarily with Asian women in both states.
The defendants are Han Lee, 41, of Cambridge, Massachusetts; Junmyung Lee, 30, of Dedham, Massachusetts; and James Lee, 68, of Torrance, California. All three were charged with conspiracy to coerce and entice to travel to engage in illegal sexual activity.
The charges carry a maximum sentence of 20 years in prison, three years of supervised release and a fine of up to $250,000, according to the Justice Department.
Agents identified customers of the network “through surveillance, phone records, customer interviews, and other investigative methods,” according to the affidavit written by the investigating case agent working for Homeland Security Investigations.
“These customers spanned a wide array of different professional disciplines,” the case agent said in court documents. “Some of these professional disciplines included, but are not limited to, politicians, pharmaceutical executives, doctors, military officers, government contractors that possess security clearances, professors, lawyers, business executives, technology company executives, scientists, accountants, retail employees, and students.”
The affidavit says the agent believes there are potentially “hundreds of yet to be identified customers.” The document also specified that the agent was not naming the individuals identified by investigators so far — but not for the purpose of protecting them.
“I do not do this for purposes of maintaining their anonymity, but instead do so because our investigation into their involvement in prostitution is active and ongoing,” the affidavit says.
According to court documents, the defendants allegedly leased apartments with rents as high as $3,664 a month, furnished them and maintained them as brothels. They also coordinated the airline travel and transportation of sex workers, the court filings said.
Court documents indicate the defendants used money orders to conceal the transfer of funds for rent in a way that intentionally did not trip anti-money laundering and Bank Secrecy Act alerts for suspicious money movement.
Appointments with the women were offered through a website for the Boston area and one for Northern Virginia, both of which advertised nude Asian models for professional photography, an affidavit filed on Tuesday said. Investigators say the businesses were used “as a front for prostitution.”
Potential clients were required to undergo a verification process that made them fill out a form that included their name, email address, phone number, employer and a reference, if they had one, the affidavit says. Prosecutors say that the defendants charged the customers approximately $350 to upward of $600 per hour and made them pay in cash.
The affidavit says that investigators have interviewed about 20 customers in connection with the probe since 2020.
The lawyer for Han Lee declined to comment on the case. The attorney representing Junmyung Lee did not immediately respond to a request for comment.
The court documents did not list a lawyer for James Lee.
The U.S. Attorney’s office in Massachusetts filed a motion on Wednesday in support of the detention of James Lee pending trial, citing the investigating case agent who wrote in a separate affidavit that the defendant poses a flight risk.
The agent wrote that James Lee “has several businesses and corresponding business bank accounts in his name and in the names of his fraudulent identities,” which he said he believes the defendant used to launder the money from the prostitution business.
The agent said James Lee falsified bank statements, pay stubs and driver’s licenses in applying for the leases of the apartments used as brothels. The second affidavit by the agent said the monthly rent was as high as $5,600 for the apartments.
“Today, four of those active brothels were subject to search warrants executed by federal law enforcement officers,” the agent said on Wednesday. “From the brothels, agents recovered among other things, condoms, cash, and women believed to be engaging in prostitution at the direction of the prostitution ring.”
The agent added that based on information obtained by a cooperating source, he said he has reason to believe this is not the only prostitution network James Lee is tied to.
Investigators also said that James Lee made deposits in his personal and business bank accounts since January 2020 that totaled $4.5 million. More than $550,000 of Covid relief funds, the agent wrote, were among those deposits. Investigators acquired records from the Small Business Administration that, the agent suggested, show James Lee applied for these loans for various businesses, including one listed as E.P.A. Green Services, and potentially under different identities.
James Lee “utilized these accounts to conceal and disguise illicit proceeds of the prostitution business, in addition to possible fraudulently obtained Covid-19 related relief funds,” the agent wrote.
When the search warrant was executed at his home, agents did not find James Lee’s passport, the affidavit says. However, the agent wrote that it’s believed that Lee has traveled since 2017 to eight different countries on 10 separate occasions, including to South Korea, Brazil, Panama, Singapore, Canada and Colombia.