Former Silicon Valley CEO Indicted For Alleged Fraud

Employees of the start-up WrkRiot ended up working for free because their CEO deceived them about the company's finances, according to a criminal indictment unsealed in Orange County.

The former CEO named in the indictment is Isaac Choi, aka Yi Suk Choi, aka Yisuk Choi, aka Yi Suk Chae, aka Isaac Chae, (Choi), 36, formerly of Santa Clara and most recently of Orange County. He is charged with five counts of wire fraud.

The indictment alleges that the founder and chief executive officer of the now-defunct Silicon Valley tech start-up defrauded several of his company’s former employees by luring them to join his company based on false and misleading statements about his educational, professional and financial background.

Furthermore, they continued working for his company because he provided them with forged documents that supposedly showed payments for unpaid salaries.

The indictment alleges that Choi falsely claimed that he received a degree from a prestigious New York business school, worked as an analyst at a major financial institution, had access to significant personal wealth, and was investing significant amounts of that money into the company.

The indictment also alleges that after some WrkRiot employees learned that WrkRiot’s bank accounts did not contain the capital that Choi claimed to have invested, Choi falsely claimed that a significant portion of the money he pledged to invest was tied up overseas and elsewhere.

The indictment says that Choi sent a series of individual emails to WrkRiot’s employees saying that salary payments were forthcoming, and attaching documents purporting to confirm wire transfers from a U.S.-based bank to the bank accounts of the WrkRiot employees. But the indictment alleges that Choi sent forged wire transfer confirmations in order to get the employees to continue working for the company without being paid.

The FBI investigated the case. Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, U.S. Attorney Brian J. Stretch of the Northern District of California and Special Agent in Charge John F. Bennett of the FBI’s San Francisco Field Office made the announcement.