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Hampton contractor, employees plead guilty to fraud scheme

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Posted at 3:51 PM, Dec 04, 2020
and last updated 2020-12-04 15:51:55-05

NEWPORT NEWS, Va - Defense Contractor and owner of Iris Kim Inc., also known as I-tek, Beyung S. Kim, and his employees, Seung Kim, Dongjin Park, Chang You, Pyongkon Pak, and Li-Ling Tu, pleaded guilty to partaking in an extensive procurement fraud scheme involving millions of dollars in government contracts targeting the Department of Defense and other federal government agencies.

According to a release, court documents from 2011 to 2018 confirm that the conspirators engaged in a conspiracy and scheme related to certain government contracts, where I-Tek acted as a supplier of goods, including items for the U.S. Marine Corps, U.S. Army, U.S. Coast Guard, and the National Guards of various states, among other agencies.

In addition to defrauding the U.S., officials say they fraudulently imported goods into the U.S. that were made in China, violating the terms of their contracts, they then falsely relabeled these goods as if they were made in the U.S.

Next, Kim and his employees also acted through a separate nominee company to conceal the importing of goods from China and installed a nominee officer of I-Tek in order to be able to fraudulently qualify for other contracts, according to a release.

Officials say the business owner and his employees also submitted false documents and further falsely classified the value of the goods imported into the U.S. so as to avoid higher duties and taxes.

All conspirators are scheduled to be sentenced mid-March, each defendant facing a maximum term of five to seven years in prison.