Prosecutors search
KAI offices over corruption
Posted : 2017-07-14 16:47
Updated : 2017-07-14 18:50
The headquarters of the Korea Aerospace Industries in Sacheon, South Gyeongsang Province / Yonhap
Fight against ‘the enemies within' has begun
By Jung Min-ho
Prosecutors searched the offices of Korea Aerospace Industries (KAI), Friday, on corruption allegations in aircraft development projects.
According to the Seoul Central District Prosecutors' Office, dozens of investigators searched the defense company's headquarters in Sacheon, South Gyeongsang Province, and its Seoul office over allegations it inflated product development costs to reap greater profits.
This came amid high expectations for President Moon Jae-in's pledge to root out corruption in the nation's military.
Investigators have confiscated accounting documents, computer hard disks and the mobile phones of KAI officials, but they did not specify suspects or their charges.
The latest clue came out in 2015, when the Board of Audit and Inspection (BAI) revealed KAI officials illegally acquired 54.7 billion won ($48 million) by inflating development costs for the Surion helicopter. Based on the fake costs, the BAI noted, they set up their own firms outside the company and took taxpayers' money through business contracts with KAI.
"We are not investigating one specific target. We are looking into all the allegations brought up against the company," a prosecution official said.
One of the suspects may be KAI President and CEO Ha Sung-yong, who is accused of having embezzled the company's money and bribed some aides of disgraced former President Park Geun-hye.
Prosecutors have reportedly secured clues suggesting a dodgy connection between him and three former presidential secretaries ― Ahn Bong-geun, Jung Ho-sung and Lee Jae-man.
If prosecutors collect strong evidence of the bribery allegation, the investigation may expand ― again ― to key officials of the Park administration.
Ha and several other top-ranking KAI officials have been banned from traveling overseas during the investigation. They are expected to face questioning soon.
KAI, the country's sole aircraft manufacturer, has been involved in various defense-related projects, including the Surion, T-50 supersonic trainer jet and FA-50 light attack fighter.
A KAI official denied all the allegations, saying none of its business deals were illegal.
Since the 1950-53 Korean War, the nation's military has fought two enemies mainly: one is the rancorous regime in the North and the other is corruption which has been weakening its defenses.
Eradicating corruption in the military was one of the key promises of President Moon, who knows of rampant illegal business practices in the weapons acquisition sectors and the public's fatigue toward such news.
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KAI vice president found dead amid corruption scandal
A senior official of Korea Aerospace Industries was found dead Thursday in an apparent suicide, amid a sprawling prosecutorial probe into corruption allegations surrounding the head of the country’s sole aircraft manufacturer.
According to police, the body of Kim In-sik, who was in charge of KAI’s overseas business as vice president, was found at his home in Sacheon, South Gyeongsang Province. A three-page suicide note was found near his body.
(Yonhap)
Kim’s death came a day after KAI Chief Executive Ha Sung-yong was arrested for accounting fraud. He is accused of directing the manipulation of financial records of the company‘s oversea projects and granting contracts to suppliers without a fair bidding process in return for kickbacks.
“I have done my best, but it’s so unfortunate that things didn’t work out,” Kim said in the note, according to investigative officials. Kim had been a close aide to Ha since he joined the company in 2005 after leaving the Air Force as a brigadier general.
Prosecutors on Thursday issued an arrest warrant for Ha, who had been detained without a warrant. Investigators are expected to focus on finding out whether Kim was involved in the charges circling Ha, who has denied most allegations.
One of the allegations facing Ha is that that the company made at least 24 billion won ($21.3 million) in illicit profits by inflating development costs for Surion utility helicopters, T-50 supersonic trainer jets and FA-50 light attack planes.
The prosecution is also believed to be looking into the possibility that Ha embezzled about 1 billion won from the company’s funds by creating false documents. The money was allegedly doled out to Ha and the board members.
Elected as KAI chief in 2013, Ha is also suspected of creating slush funds and inappropriately lobbying Cheong Wa Dae officials and lawmakers for his reappointment in May 2016, when former President Park Geun-hye was in power.
Before joining KAI in 2005, Kim had assumed various posts in the Air Force, including commander of the 8th Fighter Wing and executive officer to the chairman of the Joint Chiefs of Staff. He was also in charge of an aircraft procurement project in the Defense Acquisition Program Administration.
He began his civilian career at KAI by working as a contractor in the United Arab Emirates. Since then, he has supervised most of the company’s overseas projects, including a deal to sell FA-50 jets to Iraq in 2013.
justo el dia de la primavera encontraron muerto al vice presidente de kai .
La muerte de Kim ocurrió un día después de que el presidente ejecutivo de KAI, Ha Sung-yong, fue arrestado por fraude contable. Se le acusa de dirigir la manipulación de los registros financieros de los proyectos de ultramar de la compañía y la concesión de contratos a los proveedores sin un proceso de licitación justo a cambio de sobornos.