A suit filed Friday in the US District Court in Los Angeles by four South Korean banks say “ monolithic pretender ” with an great debt of at least $ 230 million , and California - found electronic parts marketer Newegg has been named as a suspect , along with wholesaler ASI Corporation and its officers .
The Industrial Bank of Korea , Keb Hana Bank , Nonghyup Bank , and Kookmin Bank — which are being represented by LA business firm Gibson Dunn — are essentially following up ona 2015 suitwhich brought down the central figure of the alleged fraud : Moneual chief operating officer Park Hong - seok . In 2015 , Park was sentenced to 23 days in prison house and ordered to forfeit over $ 31 million after borrowing and neglect to repay gazillion , a schema the current cause calls “ one of the large instances of humbug in South Korea ’s history . ” The banks are now targeting the companies they consider acted as Moneual ’s co - plotter overseas .
These young documents allege that Moneual , Newegg , and ASI were enlist in “ an intricate outline of circular transactions . ” The banks submitted a list of over 70 pages of supposedly fraudulent order as evidence that Newegg and ASI created the paperwork that Moneual used to assure loanword . The suit further claims that Newegg and ASI “ incur kickback from Moneual in varying sum of money in exchange for agreeing to collude with Moneual to defraud the banking concern . ”
One method of inflating leverage order for Moneual — a brand scarcely remembered in North America as a a crushed - tier starter into the robotlike vacuums market — allegedly involved create paperwork that showed components being sold for over 370 times their value . From the lawsuit ( emphasis ours ):
Newegg cut fallacious leverage orders for the purpose purchase of domicile theater personal information processing system ( “ HTPCs ” ) and other goods manufacture by Moneual . With respect to the HTPCs , Moneual purported to rouse ASI and Newegg between $ 2,530 and $ 2,980 per HTPC whole , and those amounts were stated on the invoices and purchase orders from ASI and Newegg upon which the Banks ripe funds to Moneual . However , the Banks after learned that in reality , the HTPCs were only worth $ 8 per unit .
Though his judgment of conviction was eventually reduced to 15 years , Park Hong - seok was convict in the “ classic Ponzi dodging ” that ruined his company . The current wooing demand monetary damages from Newegg and ASI to be determined at a panel run .
We have reached out to both Newegg and ASI for comment and will update if we hear back .
Update 8:49pm ET : Newegg provided the following statement to Gizmodo
Newegg prides itself on conducting business fairly , ethically and aboveboard . The company vehemently deny the allegation in the charge file last week , and Newegg intends to vigorously defend itself against those unwarranted charges .
[ LA Times ]
CrimeNewegg
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