A Great Falls man has admitted he played a key role in what authorities have described as one of the most brazen federal contracting scams in U.S. history, according to court records that became public Monday.
Young N. Cho, who also goes by the first name of Alex, pleaded guilty to conspiracy and bribery charges at a secret hearing in September — just weeks before federal agents arrested four other men in a $20 million scheme that targeted the Army Corps of Engineers.
Cho’s plea deal became public after a federal judge ordered it unsealed.
Cho, 40, was chief technology officer of Nova Datacom, a Chantilly-based information technology company that did work with the Army Corps. His role in the scam began in 2007 when he began passing kickbacks to two program managers at the Army Corps in exchange for lucrative contracts, according to court papers.
Within a year, a third man, the contracting director at a private company, EyakTek, got involved, prosecutors said.
Cho’s company was a subcontractor to EyakTek on many projects, and he submitted inflated invoices to EyakTek or directly to the Army Corps. He then distributed the proceeds to the other conspirators, prosecutors said. In all, prosecutors said, the men inflated $25 million in invoices by $20 million during a three-year span.
Authorities last year began investigating Nova Datacom in an unrelated fraud scam. Early this year, Cho disclosed the Army Corps scandal to federal agents and prosecutors, according to sources familiar with the investigation. Within months, he was wearing a recording device as he made payments to other conspirators, according to the sources and court records.
Cho had been free on personal recognizance since pleading guilty Sept. 20 and had even visited California, according to court records. But prosecutors filed court papers Nov. 3 that alleged Cho had committed obstruction of justice since his plea. He has been detained since early November, according to sources familiar with his case.
Joseph T. Mallon Jr., an attorney representing Cho, declined to comment. Federal prosecutors also declined to comment on the case, saying it remains part of an active investigation.
The four others charged in the conspiracy — the two Army Corps program managers, Kerry Khan, 53, and Michael Alexander, 55; Khan’s 30-year-old son, Lee; and Harold F. Babb, 60, the EyakTek contracting director — have been detained since their arrests in early October on money laundering and bribery charges.
EyakTek issued a statement shortly after the arrests saying it had fired Babb when it learned about the charges and was cooperating with authorities. The Army Corps has referred questions to federal prosecutors.
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