Attorney General Loretta E. Lynch Announces Return of Forfeited Public Corruption Assets to Korean Minister of Justice Kim Hyun-Woong
The Department of Justice returned $1,126,951.45 in forfeited assets to the government of the Republic of Korea today. The forfeited assets were the profits of a public corruption scheme orchestrated by former Korean President Chun Doo Hwan in the 1990s, and were laundered to the United States by Chun’s family members and associates. The assets were forfeited in two recent United States civil forfeiture actions as part of the Department of Justice’s Kleptocracy Asset Recovery Initiative, which is coordinated by the department’s Asset Forfeiture and Money Laundering Section.
“The return of these assets is a powerful vindication of the rule of law, and an important victory for the people of the Republic of Korea,” said Attorney General Loretta E. Lynch. “Since it was established in 2010, the Kleptocracy Asset Recovery Initiative has been an effective tool in our ongoing efforts to curb high-level public corruption around the world. As we move forward, the Department of Justice will remain committed to using all the resources at its disposal to ensure that government funds go to their lawful purposes; that stolen assets are returned to state coffers; and that corrupt officials are held fully accountable for abusing their positions.”
Immigration and Customs Enforcement-Homeland Security Investigations (ICE-HSI) and the FBI investigated the cases leading to the U.S. forfeiture of the assets being returned to Korea and served as the seizing agencies.
“The FBI is committed to tracing, seizing and forfeiting the assets of corrupt foreign politicians who have abused their power to enrich themselves and use the United States financial markets to launder their ill-gotten gains,” said Assistant Director Joseph Campbell of the FBI’s Criminal Investigative Division. “The funds returned represent a successful and important collaboration between the United States and the Republic of Korea.”
“I commend the men and women of our Homeland Security Investigations Regional Attaché Office in Korea and the Special Agent in Charge Office in Philadelphia who worked tirelessly to bring this foreign corruption case to fruition,” said Director Sarah R. Saldaña of ICE. “Let this case be a message that corruption on all levels will be investigated and that the United States will work multilaterally with countries throughout the world to protect citizens from the wrongs caused by public servants motivated by greed.”
In 1997, a criminal court in Korea convicted former President Chun of accepting more than $200 million in bribes from Korean corporations and ordered him to pay approximately $212 million in criminal penalties. In 2013, the Anti-Corruption Division of the Korean Supreme Prosecutor’s Office opened a money laundering investigation regarding the potential laundering of the bribery proceeds into the United States by Chun and his associates through the acquisition of U.S. real estate and opening of U.S. bank accounts.
Prosecutors assigned to the Kleptocracy Asset Recovery Initiative initiated their own investigation, aided by agents from ICE-HSI and the FBI. In January 2014, FBI investigators in the Central District of California seized $726,951.45 held in a California escrow account, which was traced to the sale of real estate property acquired by Chun’s son and his girlfriend in 2005 in Orange County, California. In February 2015, Kleptocracy prosecutors filed a second civil forfeiture action in the Eastern District of Pennsylvania seeking to forfeit a secured investment worth approximately $500,000 in a Pennsylvania company, which also was traced to Chun’s corruption scheme. On March 4, 2015, the department reached a settlement agreement of its civil forfeiture actions, resulting in the forfeiture of a total of $1,126,951.
The investigation was conducted jointly by ICE-HSI’s Philadelphia Office, ICE-HSI’s Regional Attaché Office for Korea and Japan at the U.S. Embassy in Seoul, the FBI Los Angeles Division’s West Covina Resident Agency and the Criminal Division’s International Corruption Unit-FBI Kleptocracy Program. Kleptocracy prosecutors worked closely with Korean law enforcement authorities, principally through the Seoul Central District Prosecutor’s Office, the Supreme Prosecutor’s Office and the Ministry of Justice. The cases were prosecuted by Assistant Deputy Chief Woo S. Lee and Trial Attorney Della Sentilles of the Criminal Division’s Asset Forfeiture and Money Laundering Section, Assistant U.S. Attorneys Katharine Schonbachler and Steven R. Welk of the Central District of California and Assistant U.S. Attorneys Joseph Minni and Alvin Stout of the Eastern District of Pennsylvania. The Criminal Division’s Office of International Affairs provided substantial support.
This case was brought under the Kleptocracy Asset Recovery Initiative by a team of dedicated prosecutors in the Criminal Division’s Asset Forfeiture and Money Laundering Section, working in partnership with federal law enforcement agencies to forfeit the proceeds of foreign official corruption and, where appropriate, return those proceeds to benefit the people harmed by these acts of corruption and abuse of office.