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SEOUL —- Management of a widely criticized on-base Internet and telephone service has been transferred to a new South Korean company, Army and Air Forces Exchange Service officials confirmed Monday.

Service throughout “most of Korea” was transferred from Samsung Rental Corp. Ltd. (SSRT) to LG Dacom on Jan. 31, according to an AAFES statement provided to Stars and Stripes early Monday afternoon.

The move comes as Samsung president Jeong Gi-hwan awaits trial in South Korean court on charges he bribed two U.S. AAFES employees in connection with the $206 million contract that began in 2001.

H. Lee Holloway, whose 17-year-career with AAFES ended on Jan. 11, and Clifton W. Choy, services program manager at AAFES’ Pacific headquarters on Okinawa, are under investigation by Air Force special agents in connection with the case. The findings will be provided to the U.S. Attorney to weigh whether future action might be warranted.

Holloway and Choy have declined to talk to Stars and Stripes.

Okinawa-based AAFES officials were unable to answer questions on the new LG Dacom service and forwarded queries to AAFES headquarters in Dallas.

Unclear Monday was the process by which LG Dacom earned the contract, when it expires and why the decision was made. In 2004, AAFES extended SSRT’s contract through 2019.

AAFES officials told Stars and Stripes in January that if bribery allegations prove founded, they were ready to weigh “the full spectrum” of corrective measures.

“So I think our customers there in Korea can feel assured that we will do everything within our ability to ensure they get a fair shake, if that’s the right word, a resolution, to this particular situation,” Air Force Col. Jorge S. Garza, director of loss prevention at AAFES’ headquarters, told Stripes during a mid-January interview.

Garza said Air Force Maj. Gen. Paul W. Essex, AAFES commander, “has given our general counsel the authority and the guidance to prosecute violators that have gone and broken our public trust and our customers’ trust, and to prosecute them to the furthest extent.”

Since Stars and Stripes began reporting the case in early January, SSRT officials have acknowledged they can improve customer service but said their prices were not out of line and denied any allegations of a substandard product.

Lt. Col. Dean Thurmond, AAFES’ chief of corporate communications, was quoted in Monday’s statement as predicting great things from the new partnership with LG Dacom.

In the next few weeks, he said, several planned improvements are to be announced. These include faster Internet speed, improved price packaging and an option for Voice over Internet Protocol service.

“We look forward to announcing these improvements as soon as the details are worked out,” he said.


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