Ex-Ontario tool company exec from San Dimas gets 5 years for bank fraud

LOS ANGELES >> A San Dimas mad who formerly served as vice president of an Ontario-based tool company received a sentence of more than 5 years in federal prison Wednesday for a $9.6 million bank fraud scheme, authorities said.
Chung Yu Yeung, 39, pleaded guilty in late-March to four counts of bank fraud and one count of conspiracy to commit bank fraud.
At his sentencing hearing Wednesday in federal court in Los Angeles, U.S. District Judge Christina A. Snyder sentenced Yeung to 63 months in prison and ordered him to pay $9,618,908 in restitution to his victim, East West Bank, U.S. Department of Justice spokesman Thom Mrozek said in a written statement.
He was also ordered to forfeit a property in San Dimas that he purchased “with proceeds of the scheme,” Mrozek said.
Yeung previously admitted that while working at Eastern Tools and Equipment Inc., Yeung admitted that he and his co-conspirators defrauded East West Bank by misrepresenting the company’s accounts receivable and financial statements in order to obtain loans the company otherwise would not have been able to get, Mrozek explained.
“The conspirators created numerous shell corporations to act as purported suppliers and retailers doing business with Eastern Tools, when, in reality, these shell corporations were entirely under the control of Yeung and existed for the sole purpose of creating the illusion of such business,” Mrozek said. “Yeung also admitted that the fictitious companies allowed Yeung and other conspirators to falsely inflate Eastern Tools’ accounts receivable and financial statements in representations to East West Bank.”
“Yeung created companies and profits that were nothing but illusions, tricking a bank into loaning him millions of dollars,” U.S. Attorney in the Central District of California Eileen M. Decker said. “This was a sophisticated crime that caused substantial losses, warranting the punishment imposed by the Court today.”
Yeung’s co-defendant in the case, former Eastern Tools president Guo Xiang Fan, remains a fugitive, Mrozek said.
IRS Criminal Investigations Acting Special Agent in Charge Anthony J. Orlando described the scene as “truly astounding.”
“(It) illustrates the lengths to which fraudsters will go to game the financial system for personal gain. IRS Criminal Investigation is proud to work with our law enforcement partners by lending our financial expertise in these complex investigations,” he said.

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