Prosecutors say brothel suspect also collected possibly fraudulent COVID funds


Investigators believe James Lee used several business and related bank accounts to “launder the proceeds of the prostitution business,” court documents show.

Federal prosecutors say a brothel ring based in Massachusetts and Virginia was operating out of several units at 90 Fawcett St. in Cambridge, among other locations. Nathan Klima for The Boston Globe

A California man arrested this week in connection with a high-end brothel network that allegedly operated out of Greater Boston and Virginia may have also fraudulently obtained more than $550,000 in COVID-19 relief funds, according to court documents.

James Lee, 68, is charged alongside two others — Han “Hana” Lee, 41, of Cambridge, and Junmyung Lee, 30, of Dedham — for allegedly orchestrating a commercial sex ring that catered to an elite clientele ranging from politicians to military officers.

  • Feds: Alleged sex ring drew politicians, business execs to brothels in Mass.

The interstate brothel network allegedly operated out of high-end apartments, attracting clients through two websites that claimed to advertise nude models for professional photography. Federal prosecutors say James Lee used his real identity and at least two aliases to rent several apartments in Watertown and Cambridge, as well as in Fairfax and Tysons, Virginia, according to an affidavit filed Wednesday in U.S. District Court in Boston.

“In exchange for opening the leases in his identity, or his fraudulent ones, James received $1,000 per month for each brothel location that remained open,” the affidavit reads. “A review of bank records for his co-conspirator, Han, revealed that he in fact received at least $64,000 from her, which is believed to be compensation for placing the brothel leases in his name, or in his fake identity.”

Han Lee and Junmyung Lee were both ordered held without bail pending a Nov. 13 detention hearing. James Lee was arrested Wednesday in California and will appear in Boston court at a later date. has reached out to his attorney for comment. 

Details about James Lee’s finances were revealed as part of a motion arguing for his detention pending trial. In the accompanying affidavit, a U.S. Department of Homeland Security agent described Lee as a flight risk and noted that he has taken several overseas trips in recent years. 

According to the affidavit, financial records indicated that Lee has several businesses and related bank accounts in his name and under aliases, which investigators believe he used to “launder the proceeds of the prostitution business.”

Authorities also reportedly found a number of deposits from various COVID-19 relief funds into Lee’s personal and business accounts, for a total of $550,633 in funding meant to help businesses struggling in the wake of the pandemic. 

Overall, the financial activity in Lee’s accounts “does not appear commensurate for the listed purposes” of his businesses, the affidavit concluded. 

“I therefore believe that James 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 Homeland Security agent wrote. 

A search of Lee’s home in Torrance, California, turned up about $15,000 in cash tucked away in envelopes, as well as ledgers, banking documents, and identification documents in Lee’s name and other aliases, according to the affidavit. 

Prosecutors allege that the brothel network dates back to at least July 2020 and may have attracted hundreds of sex buyers. The alleged clients are neither named nor charged at this point.