SK Construction Raided By South Korean Authorities for Corruption Involving Expansion of US Military Base

The corruption probes and investigations surrounding the expansion of the US military base Camp Humphreys in South Korea continues:

Picture of construction during the Camp Humphreys expansion project.

South Korean prosecutors have raided the offices of one of the nation’s largest conglomerates amid allegations it offered multimillion-dollar kickbacks to the US Army in exchange for construction contracts.

Dozens of investigators were dispatched to the headquarters of SK Engineering and Construction in downtown Seoul on Friday to confiscate computer hard disks, documents and other material related to construction projects at a new US army base in South Korea’s Pyeongtaek county.

The prosecutors are investigating allegations that the company — an affiliate of the nation’s third-largest conglomerate, SK — gave almost $3m to a US army officer in 2010 to steer a $420m dollar construction contract in its favour.

The officer, Duane Nishiie of the US Army Engineers Corp, was indicted in September in Hawaii on charges including bribery, wire fraud and money laundering related to the case. Lee Seung-ju, a former officer in the procurement department of Seoul’s defence ministry, was indicted on the same charges.

SK Engineering and Construction declined to comment. US Forces Korea was not immediately available to comment.

“The raid was needed to look into the bribery claims linked to a US military contract,” the prosecutor in charge of the investigation told the Financial Times.   [The Financial Times]

You can read the rest at the link.

Woman Arrested for Defrauding the VA By Falsely Claiming to Be Mother of Deceased Veteran’s Son

If this woman was able to so easily fool the VA for years to receive benefit money it just makes me wonder how much more fraud is going on?:

A woman faked the birth of a son to collect the veterans benefits for 17 years, according to court documents.

The man who the woman claimed was the father of the child was killed in High Point in 2006.

Elizabeth Hayes Cox, 60, claimed she gave birth to the son of Randall Cox, who was a military veteran receiving Veterans Administration benefits, according to an indictment. Records show she claimed Randall Cox’s benefits should be paid to her for child support, and she fraudulently collected $103,000 in benefits from March 2000 through May of this year.  [Stars & Stripes]

You can read the rest at the link, but you would think the VA would ask for something as simple as a birth certificate to prove her claim?

Itaewon Bar Owners Indicted for Scamming Foreign Tourists

This is an example of why I never use a credit card in a bar or restaurant when traveling overseas.  Scams like this I remember were common in the villes outside US military bases back in the day:

A promise of a fun night out at a bar in Itaewon left an American tourist with a booze tab totaling 17 million won ($15,000).

Seoul police said on Thursday owners and employees at three bars in Itaewon, Yongsan-gu, have been indicted without detention for overcharging foreign tourists.

One of the indicted bar owners, surnamed Lee, allegedly charged an American tourist 17 million won for drinks he had during his one hour and 40 minutes stay at the bar.

The tourist found out about this overcharging only after returning to the US and receiving his credit card bill.

Two other indicted bar owners allegedly conspired to rip charge a German tourist about 7.9 million won.

The police are investigating whether the bar owners deliberately intoxicated the tourist, as traces of zolpidem and other narcotics were found in his hair.  [Korea Herald]

You can read more at the link.

Korean Shaman Found Not Guilty of Frauding Woman of $499,000

What I learned from this article is that if you commit fraud under a religious pretext it is perfectly legal.  By the way who knew being a shaman could be so lucrative?:

A shaman who was taken to court on charges of fraud was ruled not guilty by the Seoul Southern District Court on Wednesday.

“Shamanism is, for the most part, aimed at gaining consolation and inner peace. Even if shamanistic rituals do not yield the promised outcome, it is difficult to hold the shaman accountable for the failure,” the court said.

The shaman in the case had blamed the spirits of the victim’s aborted twin babies for her husband’s flagging business and suggested the victim appease the spirit babies through special rituals.

The prosecution accused the shaman of fraud for carrying out an excessive number of rituals and charging over 560 million won ($499,000). The shaman provided 133 rituals in the period between January 2011 and December 2015. During the time, she sent mobile text messages to the alleged victim using baby talk as if she was possessed with the twins’ spirits.

The text messages read, “I know how you feel mommy. Please don’t feel sad. We love you,” “We ate loads of the meat you sent us. We love it very much.”  [Korea Herald]

You can read more at the link.

South Korean Employee Embezzles $100 Million from ABB Robotics Firm

It is amazing to me that one employee would have access to this much money to embezzle:

A major European conglomerate says one of its employees in South Korea has gone missing — along with $100 million.

Power and robotics firm ABB (ABB) announced Wednesday that it has “uncovered a sophisticated criminal scheme” at its South Korean unit. It only noticed the huge sums had been stolen after the employee of the subsidiary disappeared about two weeks ago.

The employee, who ABB has not identified, is suspected of forging documents and working with individuals outside the company to steal the money, according to ABB and South Korean police.

A police spokesman said that the suspect is believed to have fled to Hong Kong and that they are working with Interpol to bring him back to South Korea. Interpol declined to comment on the investigation.

The embezzlement and misappropriation of funds is limited to South Korea, where ABB employs about 800 staff, the company said. Other people could still come under investigation.  [CNN via a reader tip]

You can read more at the link, but the guy behind the theft was the person responsible for ensuring legal and ethical integrity:

The executive, named by a source in South Korea as Oh Myeong-se, was treasurer and one of two integrity ombudsmen for ABB Korea – to whom staff were supposed to report any ethical concerns – according to an online company magazine available on ABB’s Korean website.

He was also the head of compliance at ABB in Korea until 2010, said a source familiar with the investigation, a role that carries responsibility for maintaining legal and ethical integrity.

The executive is suspected of forging documents and colluding with third parties to steal funds, ABB said, estimating it would take a pre-tax charge of about $100 million for the affair, which analysts said raised concerns about its corporate oversight. [Reuters]

It will be interesting to see who else is tied to this crime because I would be surprised if this guy was able to embezzle and move this much money all on his own.

Group Scams $24 Million from Deaf People in South Korea

This is a lot of money and a lot of people who were scammed:

Police arrested a group of people with hearing disabilities for allegedly pulling off a fraud scheme and snatching some 28 billion won ($24 million) from about 500 deaf people in Changwon, South Gyeongsang, on Thursday.

The Changwon Jungbu Police Precinct found that eight people with hearing disabilities allegedly told their victims from 2010 to 2016 that if they invested in a real estate development project to build apartments and factories, they would receive three to five times the amount of their investment within three months.

They also allegedly told victims that if the project proved successful, they would be granted expensive cars and pensions in return. Many of the victims borrowed money to make the investments.

These eight suspects, arrested for fraud and organized crime, and their roughly 500 alleged victims all belong to the same private online association of deaf people. Authorities found that the suspects and victims communicated via a group account on a mobile and internet app for non-public communications called Naver Band.   [Joong Ang Ilbo]

You can read more at the link.

Hooker Hill Visit Helps Lead to Army General Losing Two Ranks

This is what happens when you use your government credit card to pay a $1,100 bill at a Hooker Hill club in Seoul:

One of the Army’s most promising generals will be demoted to one star and retired following a scandal that involved sex clubs in Seoul and Rome, high-priced booze and indiscretions with young female troops, the Army announced Thursday.

Ron Lewis, who had been a three-star general and top aide to the then-Defense secretary Ash Carter, will also lose about $10,000 a year in pension payments due to the demotion.

The Pentagon Inspector General “substantiated allegations that Maj. Gen. Lewis misused his government travel charge card for personal expenses, made false official statements regarding his (credit card) misuse, and engaged in conduct unbecoming an officer and a gentleman on multiple occasions,” Cynthia Smith, an Army spokeswoman, said in a statement.  (……)

Army investigators found that Lewis spent more than $1,100 in April 2015 during a visit to the “Candy Bar” in Seoul. The bar, in the city’s red-light district known as “Hooker Hill,” had been deemed off limits to troops. When questioned about the charge, Lewis denied it was his, the Pentagon challenged the expense and got him a new card.  [Stars & Stripes]

You can read more at the link.

Organization Warns Koreans of Dangers of International Marriages

This is basically a scam which I am not sure how the Korean government stops people from being stupid and wasting away money like this?:

Ahn Jae-sung married Natasha, an Uzbek woman, in 2007 through a matchmaking agency. He now works full-time counseling Korean men at the International Marriage Victims’ Center, which he founded in 2010. [PARK SANG-MOON]

Ahn Jae-sung married Natasha, an Uzbek woman, in 2007 through a matchmaking agency. He now works full-time counseling Korean men at the International Marriage Victims’ Center, which he founded in 2010. [PARK SANG-MOON]

Choi Eun-suck was lonely. The 39-year-old administrator at a high school in Seoul wanted to get married but women weren’t impressed by his job. In early 2014, Choi turned to a matchmaking agency that specialized in international marriages. It showed him a computer profile of an eligible girl. She seemed both sweet and sophisticated.

Within weeks, Choi was at Incheon International Airport holding his passport and a round-trip ticket to Bishkek, the capital of Kyrgyzstan. His father warned him not to be hasty.

He should have listened. Choi met the woman whose profile he liked. She was 13 years younger than him. A few days later, he showed for a ceremony that was supposed to seal their betrothal.

It turned out to be his wedding. Before he knew it, Choi was a married man.

Choi returned home in late April 2014 to start the legal procedure to bring his wife to Korea. In June, she called to say she had been raped by a taxi driver and was pregnant. She didn’t know who the father was: Choi or the rapist.

In March 2015, Choi’s wife changed her story. She knew who the father of the baby was – and it wasn’t Choi. She had never been raped. She wanted a divorce.

Choi tried to have the marriage annulled but failed. He is now legally divorced, which puts him in a bad place in terms of getting remarried in Korea, where divorce is still stigmatized.

“People tell me to marry a Korean woman next time,” says Choi, “but no Korean family will approve of me. They’ll assume that my ex-wife divorced me because I physically abused her.”

And he feels cheated. The Kyrgyzstani woman was never sincere and Choi paid his matchmakers 23 million won ($20,079), which doesn’t include the money he sent his wife every month for a year. He believes he’s owed the matchmaking fee back. He is awaiting a final appeal in the case.  [Joong Ang Ilbo]

You can read more at the link, but someone has actually started a International Marriage Victims’ Center to counsel and provide support to people burned by international marriages in Korea.

Nearly 10,000 California National Guard Soldiers Ordered to Pay Back Reenlistment Bonuses

Here is a story that is likely to get the blood boiling for many people this morning:

Soldiers from the California Army National Guard have been ordered to return enlistment bonuses they received a decade ago when the Pentagon needed troops for the wars in Iraq and Afghanistan. (California Army National Guard)

Soldiers from the California Army National Guard have been ordered to return enlistment bonuses they received a decade ago when the Pentagon needed troops for the wars in Iraq and Afghanistan. (California Army National Guard)

Short of troops to fight in Iraq and Afghanistan a decade ago, the California National Guard enticed thousands of soldiers with bonuses of $15,000 or more to reenlist and go to war.

Now the Pentagon is demanding the money back.

Nearly 10,000 soldiers, many of whom served multiple combat tours, have been ordered to repay large enlistment bonuses — and slapped with interest charges, wage garnishments and tax liens if they refuse — after audits revealed widespread overpayments by the California Guard at the height of the wars last decade.

Investigations have determined that lack of oversight allowed for widespread fraud and mismanagement by California Guard officials under pressure to meet enlistment targets.  [LA Times]

You can read the rest at the link, but basically California National Guard personnel were illegally giving out federal reenlistment bonuses to personnel who did not qualify in order to meet their quotas:

In 2010, after reports surfaced of improper payments, a federal investigation found that thousands of bonuses and student loan payments were given to California Guard soldiers who did not qualify for them, or were approved despite paperwork errors.

Army Master Sgt. Toni Jaffe, the California Guard’s incentive manager, pleaded guilty in 2011 to filing false claims of $15.2 million and was sentenced to 30 months in federal prison. Three officers also pleaded guilty to fraud and were put on probation after paying restitution.

Instead of forgiving the improper bonuses, the California Guard assigned 42 auditors to comb through paperwork for bonuses and other incentive payments given to 14,000 soldiers, a process that was finally completed last month.

Roughly 9,700 current and retired soldiers have been told by the California Guard to repay some or all of their bonuses and the recoupment effort has recovered more than $22 million so far.

The way I look at it is if the personnel who were given the bonuses did not know they were improperly given then why should they be forced to pay it back when they fulfilled their end of the contract?  This looks like something Congress needs to take a hard look at and rectify.

Army Deserter Defrauds VA By Claiming to Be A Vietnam and Korea Veteran

Stories like this make me wonder how much more fraud is going on in regards to VA disability payments?:

crime image

An Army deserter from Morganton is accused of receiving tens of thousands of dollars in veteran benefits by faking war wounds and military honors.

Roy Lee Ross Jr., 64, faces up to 35 years in prison on charges of executing a scheme to defraud the Veterans Administration, making false statements in connection with the delivery of VA health care benefits, stealing from the VA and making a false claim for travel benefits from the VA.

According to a federal indictment released on Friday, Ross enlisted in the Army in 1973 and was stationed stateside and in West Germany.

But he never served in Vietnam or Korea, was not in the Special Forces and never was wounded as he claimed, according to the indictment.  [Charlotte Observer]

You can read more at the link, but this guy did not make just one claim with the VA, but went back three times for additional claims and was able to get his monthly disability check increased to $2,906 per month and then even after getting this money he went and filed for travel reimbursement.