Brooklyn-Based Gambino Wiseguy Indicted In Seattle For Bogus Nonprofit Scheme

The Attorney General of Washington state, Bob Ferguson, filed a lawsuit on Tuesday (August 7) to shut down six fake nonprofit entities posing as well-known, international organizations.

Bob Ferguson, AG Washington state.

The brain behind the scheme is allegedly Ian Richard Hosang, a former stockbroker who was identified as having ties to the New York Mafia, specifically the Gambino crime family. Hosang was known to currently reside in Brooklyn, as per the Washington AG.

The lawsuit alleges that Hosang could be using the nonprofits to cover up illegal activity.

Hosang created six nonprofit entities in Washington: American Cancer Society of Seattle, American Cancer Society of Washington, American Red Cross of Seattle, American Red Cross of Washington, United Way of Seattle and United Way of Washington. None of these nonprofits are related to the legitimate, charitable organizations with the same or similar names.

Ferguson’s investigators appear to have uncovered the sham nonprofits before any Washingtonians donated to the organizations. (Those who donated to any of Hosang’s organizations were asked to contact the Attorney General’s Office here.)

“I’m deeply concerned that a convicted money launderer created these sham nonprofits using the names of legitimate, internationally recognized organizations,” said Ferguson. “If you donated to any of these nonprofits, please contact my office.”

In 1999, Hosang was reportedly the ringleader of a stock fraud scheme linked to the Gambino family. As per reports, he once dangled a competitor from a ninth-floor window in New York City; he also supposedly kept a stash of marijuana in his office to reward his boiler room brokers, some of whom were recruited from New York City subway riders.

Federal prosecutors busted him on a series of stock fraud charges in 1997.

As per the Washington AG's press release: Hosang previously spent 12 years in federal prison after pleading guilty to money laundering and conspiracy charges arising from his ties to the Gambino crime family in New York.

The lawsuit, filed in Washington state's King County Superior Court, alleges that Hosang violated the Consumer Protection Act and the Nonprofit Corporations Act when he incorporated the fraudulent nonprofits.

Nonprofit corporations operating in Washington must have a legitimate address along with records of finances and associates and must provide the benefits, service or education as stated in their purpose or mission statement. Hosang’s organizations failed all of these requirements, violating the Nonprofit Corporations Act.

Hosang registered the organizations as nonprofits, but did not register any of the six as charities with the Washington State Secretary of State.

Though each of the nonprofits listed an address in Washington, neither the nonprofits, nor Hosang or any other associate, reside in the state. Each organization listed its address as a UPS Store in Seattle, but Hosang instructed the store to forward any mail received at this address to a P.O. Box in Brooklyn, New York.

The “nonprofits” also did not perform any activities listed in their mission statements or provide any money or assistance to the beneficiaries they claimed to help. Additionally, Hosang fraudulently named his organizations after legitimate charities, even though he and his associates had no affiliation with them.

In November 2016, Hosang created the first of the six organizations – the American Cancer Society of Washington. Less than two years later, he created the remaining five over a span of two days in February 2018.

The Attorney General’s investigators did not find evidence that the organizations solicited donations. However, investigators discovered that Hosang received at least one check made out to The American Cancer Society of Washington. Ferguson alleges that Hosang used the nonprofits to obscure financial transactions.

In addition to his Washington organizations, Hosang created entities with variations of the same names in eight other states across the nation.

Ferguson asks the court to dissolve the organizations and prevent Hosang from operating any of the six nonprofit organizations or any new nonprofits in a similar manner. The office also requests that the court distribute any assets held by the organizations to legitimate nonprofit organizations that carry out the work that Hosang’s nonprofits purported to do.

Assistant Attorney General Joshua Studor of the Attorney General’s Consumer Protection Unit is lead attorney in the case.