Foreign Bribes Cases
Some say art imitates life, others argue life imitates art, but regardless of which philosophical position you might agree with, the line that divides reality from fiction constantly seems to be softening. Financial fraud, foreign bribery and double dealings should be plot lines for the next James Bond film but recently, the United States Department of Justice published a news story about an unlikely partnership between Malcolm Harris, a fashion designer and blogger, and South Korean professionals with familial relations to a former Secretary-General of the United Nations.Designer Turned Fraudster
It was announced earlier this year that Malcolm Harris pled guilty to money laundering, wire fraud and other counts of illegal business practices. The allegations stemmed from his involvement in a ploy to pay bribes to a foreign official over the attempted sale of a $800 million building in Hanoi, Vietnam. And if intercontinental corruption was not enough, Harris also betrayed his co-conspirators when he ran off with the bribe money. Prompting many to draw on the old proverb, “there is no honor among thieves”.
Malcolm Harris was charged alongside Ban Ki-sang—brother of Ban Ki-moon, South Korean diplomat and eighth Secretary-General of the United Nations—Ki-sang’s son, Joo Hyun Bahn and one other person charged with violating the Foreign Corrupt Practices Act of 1977 (FCPA) for helping them obtain the illicit funds.
The three men met in 2013, at the time Ban Ki-sang was employed as an executive at construction firm Keangnam Enterprises Co., Ltd. (Keangnam) and Joo Hyun Bahn worked as a real estate broker. Keangnam was founded in the 1950s and was the first Korean construction company to expand into overseas markets, but by the late 2000s there had been several destabilizing ups and downs. Ki-sang and his son sought to resolve some of the company’s liquidity issues by refinancing a high-rise building it owned and operated, that cost approximately $1 billion to construct.International Connection
Harris joined in on the scheme by offering to procure an investor for the skyscraper through a Middle Eastern affiliate however, to safeguard the arrangement, a substantial payoff would have to be made to a government official. Harris acting as the liaison between the parties would collect and remit the payouts, first in the amount of $500,000 and then $2 million upon the sale’s conclusion. The successful sale would also supply Ki-sang’s son with a sizable commission as the real estate broker for the transaction.
But the sobering truth was Harris did not have any relationship with the foreign official and did not follow through with the plan. Instead, he stole the funds transferred to him and squandered the money on individual expenses and numerous luxuries. The subsequent months of waiting for word on the sale resulted in a desperate effort by Ki-sang to keep up appearances. He tricked his firm and creditors into believing the sale would happen soon but it never did and Keangnam eventually descended into a form of corporate bankruptcy.
For all the charges laid against Harris, there is a maximum of 30 years in prison.Conclusion
This tale was fraught with conspiracy and fraud across global borders but no matter how far foreign bribery may reach, there is comfort in knowing that offices like the International Corruption Squad and Complex Frauds and Cybercrime Unit are always diligently ensuring that any criminal hand that comes upon U.S. shores is duly retracted and prosecuted.