Transcript for Ed Shin charged with embezzlement as new company he formed takes off: Part 3
I learned we've been bamboozled here. Ed was embezzling the money out of LG tech. At the same time that Ed was supposedly being the president of LG technologies, looking out for that company's interests, he had formed a rival company doing more or less the same thing. Ed and Chris have launched their own company, 800xchange. Ed shin had embezzled a lot of money from Joe and stole clients. In this partnership between Chris and Ed, Chris has just under 50% stake. And while this is a fresh start with a brand-new company, Ed is still up to his old tricks. At home, he's this model husband and a family man. On the road, he's a high stakes gambler. He's a womanizer. 800xchange was by far the biggest opportunity that Chris had had. They were generating 1,500 phone calls a day. They were making money hand over fist. These were the heady days of making money, and they were killing it. And given what you just said, it sounds like the vast majority of that was profit. About 80% of it was profit. When the business took off, Chris' circumstances were transformed. He was putting down roots. It just seemed like that thing he'd been reaching for for so long was finally there for him. He bought, along with Ed, a bunch of gold coins. In 2009, Chris Smith starts increasing his stockpile of gold, and his favorite form of gold is this. It's called a krugerrand. It's minted by the south African government, and in 2009, an ounce of one of these is worth about $1,000. And it's very popular among people like Chris Smith who don't trust banks or governments. How much gold did Chris have? I don't know the full amount, but it was tens of thousands of dollars that he stored in his condo. While Ed and Chris are trying to get this company off the ground, Ed is living the high life -- the finest suits, the most luxurious car, the most lavish trips to Las Vegas. How often do you think Ed took people to Vegas? Couple times a month, once a month. When he was in Vegas, he liked to party. He liked to be around beautiful women. He liked to be at the center of the action. He wanted to be -- instead of that sort of squeaky clean nerd in the golf club, he wanted to be the cool guy at the center of the action in Las Vegas. In 2009, while Chris's business the 800xchange is taking off, he invites his younger brother Paul to come work with him there. Chris is only two years older than Paul, but not only have they always been incredibly close, but Paul says that he saw Chris as something of a protector and a supporter. When Chris asked you to come down to Orange county, what was his pitch? My brother said, you know, we have a successful lead gen it's already been up and running for a couple months. We'd like you to come and wor for us and be in sales." We flew down to look at rentals, because we wanted to move down there once Paul started working for Chris. And Ed let us use his car, took us out to lunch. I held his kids. He was very charming. He was a religious guy, had a family. At this point, Ed and Chris are living large, spending a lot it's also at this point that Joe gray completes his audit and realizes that Ed shin has been diverting business, embezzling hundreds of thousands of dollars, stealing clients. How much money do you think Ed shin embezzled from you? We think it's like $2.5 million in total. That's a lot of money. That's a heartbreaking dollar amount. At what point did you feel like you understood the totality of Ed shin's personality? I think during that week of that Perry mason forensic audit exercise I went through -- I lived it. I lived the betrayal. Ed was the perfect jekyll and Hyde. Joseph gray extended a helping hand to Ed when he really needed that help. Ed responded by biting the hand that was feeding him. I had a mandate. My mandate was hold him accountable. Do whatever I had to do to make sure that the district attorney and Riverside county would hold him accountable. This case won't be that hard to prosecute because they've got records, they've got documents, they've got proof that shin is skimming money from the company. And he's using it to pay off big gambling debts, high-priced cars and clothes and women. In the end, he's charged in October of 2009 with felony embezzlement. Chris Smith is realizing day by day that Ed shin, his partner, is a crook. He did not care who he hurt or how he hurt people to get what he wanted. With a straight face, he would look you in the eye and be stealing from you. Who does that? Chris, his senses were on high alert. He wrote his attorney. He said, Ed is itching for a way to commit fraud against me. We got to keep that from
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