Third defendant in high-end brothel network case pleads guilty

A Torrance, Calif. man pleaded guilty Wednesday to his involvement in operating a ring of high-end brothels in rented apartments across Greater Boston and eastern Virginia, prosecutors said.

James Lee, 70, pleaded guilty to one count of conspiracy to persuade, induce, entice, and coerce one or more individuals to travel in interstate or foreign commerce to engage in prostitution; one count of money laundering conspiracy; and one count of wire fraud, according to a statement from United States Attorney Leah Foley’s Office.

Lee was one of three individuals arrested in connection with operating the prostitution network and laundering the proceeds through concealment, the statement said. Lee and his co-conspirators operated the network from at least January 2022 through November 2023, when they were arrested and charged.

Lee rented several high-end apartments that were used as brothel locations and served as the sole legal tenant of at least six locations within the network, according to the statement. For leasing and traveling between the brothel locations, Lee was regularly compensated by his co-conspirators. To lease the apartments, Lee would sometimes use fraudulent identities, including stolen identities of real people, in addition to his own.

Lee traveled between the brothel locations and served as a liaison between the prostitutes involved in the network and the property managers, taking calls and handling maintenance issues, the statement said.

The brothel network catered to wealthy and well-connected clients, including elected officials, pharmaceutical executives, doctors, military officers, government contractors, professors, attorneys, scientists, and accountants, prosecutors said.

Lee and his co-conspirators concealed the network proceeds by depositing cash proceeds into their personal bank accounts and making peer-to-peer transfers. They also used the proceeds to purchase money orders which were then used to pay for rent and utilities at the brothel locations, according to the statement.

Beginning in or around March 2020 through September 2021, Lee fraudulently obtained over $580,000 in COVID-19 relief funds, the statement said. Lee used third-party identifying information to submit false loan applications and open bank accounts to accept relief funds.

Lee also fraudulently applied for Paycheck Protection Program loans and Economic Injury Disaster Loan funds under non-existent businesses. By submitting false tax documents under a third party’s name and creating a fraudulent lease between himself and his false identity, he obtained at least $580,000 in fraudulent funds and loans, according to the statement.

Lee’s prostitution conspiracy charge carries a sentence of up to five years in prison, three years of supervised release, and a fine of up to $250,000. The money laundering charge carries a sentence of up to 20 years in prison, three years of supervised release, and a fine of either $500,000 or twice the value of the laundered funds. Lee may also serve up to 20 years in prison with three years of supervised release and face a fine of up to $250,000 or twice the loss from the scheme for the wire fraud charge, according to prosecutors.

One of Lee’s co-conspirators, Han Lee, 42, of Cambridge, pleaded guilty in September 2024 and is scheduled to be sentenced March 19. The other, Junmyung Lee, 31, of Dedham, pleaded guilty in October 2024 and is scheduled to be sentenced April 18. Despite sharing a last name, the three men are not related, prosecutors said.

Lee is scheduled to be sentenced April 29.