Hyun W. Lee, a disbarred attorney from New York, was sentenced to 54 months in federal prison for wire fraud related to a scheme that defrauded his real estate clients and their counterparts. The U.S. Attorney’s Office for the Eastern District of New York announced the sentence on Tuesday, revealing that Lee also faces financial penalties totaling over $6.5 million.
Lee, 51, of Closter, New Jersey, who practiced law under the name “Michael Lee,” was ordered to pay $3.27 million in forfeiture and $3.29 million in restitution to his victims.
Lee, originally licensed to practice law in New York in 2003, ran an office in Flushing, Queens, specializing in real estate transactions. However, he was disbarred on March 11, 2020, after the Grievance Committee found he had misappropriated funds from his clients and third parties.
Despite being prohibited from handling client funds following his disbarment, between February 2018 and May 2023, Lee continued his fraudulent activities. He misled clients and their counterparts into trusting him with funds for real estate transactions, claiming he was authorized to manage escrow funds. Instead of holding the money as promised, Lee used it for personal expenditures, including gambling at casinos and covering expenses for a restaurant where he was a co-owner.
To perpetuate his scheme, Lee fabricated documents showing a balance of nearly $3 million in his escrow account, even though the actual balance had been depleted to only $25,000. When clients requested the release of their funds, Lee falsely claimed he was working on an equitable distribution, despite already spending most of the money.
Lee’s fraudulent activities have resulted in significant financial harm to his victims, and his prison sentence is a direct consequence of his years of deceit in the real estate industry.
