And the investigation is not over, according to Ronald C. Machen Jr., U.S. attorney for the District, who said in a statement Thursday that his office is also probing Department of the Army contracts and a former employee there who traded contracts “for cash, gambling in Las Vegas and a $70,000 Lexus.”
Machen described a “brazen fraud” and “a sprawling bribery scheme involving corrupt public officials and compromised government contractors.”
Neither prosecutors nor the Army would name the latest target, who is identified in court documents as “Public Official C.” The individual is described as a former assistant program manager for a division of the Army that provides information management systems. The suspect, who began working for the government in 1990, had been an Army contracting officer in Seoul before moving to Fairfax Station in 2010 for a posting at Fort Belvoir, prosecutors said. Independent efforts to identify Public Official C, who resigned last April, were unsuccessful.
Cho, 44, and her brother, company founder Young N. “Alex” Cho, have been cooperating with investigators, prosecutors said in court. The company also pleaded guilty Thursday, admitting to paying more than $15 million in bribes to the three public officials and more than $790,000 in kickbacks to two other company executives who directed subcontracts to Nova Datacom.
Min Cho, who pleaded guilty to conspiracy to defraud the U.S. government, faces up to five years in prison, according to the plea agreement. The now-defunct company, which was based in Chantilly and provided security services to federal agencies and private-sector companies, faces a fine of up to $79 million. But it was not clear how it would pay such a large amount; Min Cho’s attorney, Barbara “Biz” Van Gelder, told U.S. District Judge Emmet G. Sullivan that the company does not have any assets.
Van Gelder described her client’s crime as one “in which you look the other way and try to minimize the actions.” But her brother “was in too deep and it just got out of hand,” Van Gelder said.
The scheme, according to prosecutors, began in 2007 with an arrangement between Alex Cho and an Army Corps of Engineers program manager, Kerry Khan, who is awaiting sentencing. Khan has admitted to directing contracts to companies in exchange for bribesand establishing shell companies to hide the money and buy real estate.
Alex Cho transferred control of the company to his sister in 2007 as part of a plan to expand into government contracting and gain a competitive edge by obtaining “small disadvantaged business” status by having a minority woman at the helm.
Min Cho admitted Thursday that she knew from discussions with her brother that he and another Nova Datacom employee, Nick Park, had bribed Public Official C in exchange for steering contracts their way.
She was also involved in conversations, according to court papers, in which her brother discussed plans to withhold information from investigators, who were looking into false documents the company had submitted, because of concerns they would learn of the bribery scheme.
“We committed these crimes,” she told the judge.
In June 2007, according to court documents, Park began giving the official gifts, including first-class airline upgrades. That month, the official recommended Nova Datacom for a contract worth about $330,000.
The next month, Park met up with the official in Hawaii to hand deliver $40,000 in cash. Alex Cho had directed his sister to give him the money that Park used to make the payment. Later that year, Alex Cho paid the official $10,000 more in cash, in addition to casino chips and lodging in Las Vegas, the documents say.
Park and Alex Cho pleaded guilty previously and are awaiting sentencing.
Magda Jean-Louis contributed to this report.