South Korean company pleads guilty in U.S military base corruption scandal
12 Jun 2020

One of South Korea’s largest engineering firms, SK Engineering and Construction, pleaded guilty to one count of wire fraud in obtaining a construction contract worth hundreds of millions of dollars from the U.S. Army, the Department of Justice announced Wednesday.

SK received a contract in 2008 at Camp Humphreys, the headquarters of United States Forces Korea, by funneling payments to an official with the U.S. Army Corps of Engineers, according to plea documents.

SK agreed to pay a total $68.4 million in criminal and civil fines and restitution to the U.S. Army in a plea agreement entered in a Western District of Tennessee federal court. The company will also serve three years of probation, during which time SK will not pursue U.S. federal government contracts.

SK created a fake construction company to cover roughly $2.6 million in payments to the official and submitted false documents to the U.S. Army, the Department of Justice said. The company also admitted that its employees obstructed the criminal investigation by burning documents and attempting to persuade an individual not to cooperate with U.S. authorities.

“Today’s guilty plea and substantial criminal penalty sends a clear message,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division. “[C]ompanies like SK — which withheld and destroyed documents, attempted to persuade a witness not to cooperate and failed to discipline any responsible employees — will pay a price.”

The criminal fines of more than $60.5 million are the largest ever imposed in the Western District of Tennessee. SK also paid civil penalties amounting to $5.2 million and an additional $2.6 million in restitution to the United States Army.

Two SK employees, Lee Hyeong-won and Lee Dong-Guel, were indicted by a federal grand jury on charges of conspiracy, fraud and obstruction in 2018, but the two remain fugitives of justice, the Justice Department added.

By Thomas Maresca, UPI, 11 June 2020

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