Two employees of SK Engineering & Construction Co., Ltd.
(SK), a large multinational corporation based in the Republic of Korea (South
Korea), were charged today with participating in a scheme to defraud the United
States by submitting fraudulent subcontracts to conceal bribes and kickbacks
paid to an American public official, in relation to U.S. Army construction
contracts in South Korea.
Assistant Attorney General Brian A. Benczkowski of the
Justice Department’s Criminal Division, U.S. Attorney D. Michael Dunavant of
the Western District of Tennessee, Special Agent in Charge Ray Park of the U.S.
Army Criminal Investigation Command (Army-CID) Pacific Fraud Field Office,
Special Agent in Charge Stan Newell of the Defense Criminal Investigative
Service (DCIS), and Assistant Director in Charge Paul D. Delacourt of the FBI’s
Los Angeles Field Office made the announcement.
Hyeong-won Lee, 58, and Dong-Guel Lee, 48, both citizens of
South Korea and employees of SK
Engineering & Construction Co., Ltd. (SK), were charged with one count of
conspiracy to defraud the United States and to commit wire fraud and
obstruction of justice, and one count of major fraud against the United
States. Hyeong-won Lee was also charged
with two counts of wire fraud and one count of money laundering conspiracy, and
Dong-Guel Lee was charged with one count of witness tampering in relation to a
wide-ranging bribery and fraud scheme from 2008 to 2017. The defendants are not related.
“Hyeong-won Lee and Dong-Guel Lee allegedly submitted
fraudulent construction subcontracts to disguise millions in kickback payments
to a public official and then tried to cover their tracks,” said Assistant
Attorney General Benczkowski. “The
Department of Justice is dedicated to protecting taxpayer dollars by
safeguarding the integrity of government contracts and construction projects
that support our U.S. military and civilian personnel, wherever they serve
around the world.”
“Protecting the U.S. Treasury and the interests of the
federal government abroad is a top priority of this office, and this indictment
shows our commitment to hold foreign actors accountable for major fraud
committed against the United States,” said U.S. Attorney Dunavant.
According to the indictment, the defendants, acting on behalf
of SK, submitted fraudulent subcontracts to the U.S. Army as part of two
construction contracts at Camp Humphreys, South Korea, worth hundreds of
millions of dollars. The indictment
alleges that the defendants and their co-conspirators used these fraudulent
subcontracts to launder millions of dollars in kickbacks for a U.S. public
official who had steered two Camp Humphreys construction contracts to SK.
The indictment also alleges that the defendants obstructed
investigations into the scheme. According
to the indictment, Hyeong-won Lee ordered SK employees to destroy documents
related to the fraudulent subcontract, and SK employees burned boxes of
documents in order to prevent their use by investigators. The indictment also alleges that Dong-Guel Lee,
acting on SK’s behalf, impeded federal investigations by dissuading witnesses
from testifying about their knowledge of the scheme.
Army-CID, DCIS, and the FBI are investigating the case. Assistant Chief Justin Weitz of the Criminal
Division’s Fraud Section and Assistant U.S. Attorney Tony Arvin of the Western
District of Tennessee are prosecuting the case.
The Fraud Section is grateful for the assistance of the Criminal
Division’s Public Integrity Section in this case.
The charges in the indictment are merely allegations, and
the defendants are presumed innocent until proven guilty beyond a reasonable
doubt in a court of law.
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