Criminal Justice News

Wednesday, June 20, 2012

Virginia Businessman Pleads Guilty to Federal Charges in Bribery and Kickback Scheme Involving Government Contracts

Nine People Have Now Pled Guilty, Including Two Former Managers with the U.S. Army Corps of Engineers

WASHINGTON—Nick Park, also known as Nochol Park, 47, a Northern Virginia businessman, pled guilty today to federal charges in a case involving bribery, kickbacks, and government contracts that were awarded through the U.S. Army Corps of Engineers and the Department of the Army, bringing to nine the number of defendants who have now pled guilty to charges.

Park pled guilty to two counts of bribery before the Honorable Magistrate Judge John M. Facciola in the U.S. District Court for the District of Columbia. No sentencing date was set. He faces a maximum of 15 years in prison for each of the charges, along with potential fines and restitution.

The plea was announced by U.S. Attorney Ronald C. Machen Jr.; James W. McJunkin, Assistant Director in Charge of the FBI’s Washington Field Office; Rick A. Raven, Special Agent in Charge of the Washington Field Office of the Internal Revenue Service-Criminal Investigation (IRS-CI); Peggy E. Gustafson, Inspector General for the Small Business Administration (SBA); Robert E. Craig, Special Agent in Charge of the Mid-Atlantic Field Office of the Defense Criminal Investigative Service (DCIS); and Frank Robey, Director of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit (MPFU).

Today’s developments come a month after the guilty plea of Kerry F. Khan, a former program manager for the Army Corps of Engineers. Khan, 54, pled guilty to charges of bribery and conspiracy to commit money laundering in a scheme in which he received or was promised more than $26 million in payments from various contractors who submitted fraudulently inflated invoices to the government.

According to a statement of offense, signed by the government as well as the defendant, Park started work in early 2007 for Nova Datacom, LLC, one of the companies that would become involved in the scheme. Nova Datacom was a provider of information assurance and security services to federal agencies and commercial companies, including the U.S. Army Corps of Engineers. While at Nova Datacom, Park worked with, among others, Alex N. Cho, who was then the company’s chief technology officer.

In 2007, Park and Cho took part in discussions with Khan about government contracts. In exchange for Khan using his official position to direct orders to Nova Datacom, Park and Cho agreed to provide him with items of value. Later that year, Park provided Khan with cash payments on two occasions, totaling at least $50,000.

In August of 2007, Khan stated that Nova Datacom would not have to provide any equipment or services in return for an anticipated contract. Park declined to go forward with the order based on, among other things, his concern that the fictitious contract would be detected. Park also left Nova Datacom at that time and urged Cho to stop doing business with Khan.

As part of his statement of offense, Park admitted paying bribes to a second public official, identified in court papers as Public Official C, who was employed by the Department of the Army. Park admitted providing Public Official C with $40,000 in cash and other benefits in exchange for Public Official C directing orders to Nova Datacom. After Park left Nova Datacom to start his own government contracting company, Unisource Enterprise Inc. (UEI), Park admitted that Public Official C agreed to direct orders to UEI in exchange for Public Official C obtaining a secret ownership interest in UEI. As part of his plea agreement, Park has agreed to cooperate with the government in its ongoing criminal investigation.

In addition to Park and Khan, the others who have pled guilty include Michael A. Alexander, a former program manager with the Army Corps of Engineers; Harold F. Babb, the former director of contracts at Eyak Technology LLC (EyakTek), an Alaska Native-owned small business; Cho, the former chief technology officer of Nova Datacom, LLC; Theodoros Hallas, who also worked for Nova Datacom; Robert L. McKinney, the president of Alpha Technology Group, Inc.; James Edward Miller, the owner of Big Surf Construction Management LLC; and Lee A. Khan, the son of Kerry Khan.

In announcing the plea, U.S. Attorney Machen, Assistant Director in Charge McJunkin, Inspector General Gustafson, Special Agent in Charge Craig, Special Agent in Charge Raven, and Director Robey thanked those who investigated the case from the FBI’s Washington Field Office; the Office of the Inspector General for the Small Business Administration; the Department of Defense’s Defense Criminal Investigative Service; the Defense Contract Audit Agency; the Washington Field Office of the Internal Revenue Service-Criminal Investigation; and the Army Criminal Investigation Command. They also expressed thanks to the U.S. Marshals Service for its assistance on the forfeiture matter.

They also praised the efforts of those who worked on the case from the U.S. Attorney’s Office, including Assistant U.S. Attorneys Michael K. Atkinson and Bryan Seeley of the Fraud and Public Corruption Section and Assistant U.S. Attorney Anthony Saler of the Asset Forfeiture and Money Laundering Section. Finally, they expressed thanks for assistance provided by former Special Assistant U.S. Attorney Christopher Dana; Forensic Accountant Maria Boodoo; Paralegal Specialists Tasha Harris, Lenisse Edloe, Shanna Hays, Taryn McLaughlin, Sarah Reis, Christopher Samson, and Nicole Wattelet; and Legal Assistants Krishawn Graham and Jessica McCormick.

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