Prosecutor seeks prison term, fine for SRRT executive
January 13, 2008
SUWON, South Korea — A prosecutor asked Friday for a prison term and fine for the South Korean businessman accused of bribing AAFES officials so Internet company SSRT could hold a lucrative contract with the U.S. military on the peninsula.
In a five-minute session in Suwon District Court on Friday morning, prosecutor Jang Hye-young recommended SSRT executive Jeong Gi-hwan be sentenced to 18 months in prison and fined 100 million won (about $109,000). SSRT is also known as Samsung Rental Corp. Ltd.
Jeong is accused of paying tens of thousands of dollars in bribes to former Army and Air Force Exchange Service officials Clifton W. Choy and H. Lee Holloway.
Appearing before judge Kim Mi-ri, Jeong’s lawyer, Jang Ho-jin, said his client feels remorseful, has suffered immeasurable financial damage, and is eager to recover.
Jang asked the judge to spare Jeong a jail sentence and instead fine him.
Jeong, wearing a charcoal pinstriped suit, white shirt and blue polka-dot tie, then stood and spoke for about 20 seconds, saying he’d perhaps been overzealous in his eagerness to build SSRT into a successful company.
He then uttered a Korean apology, “Chway-song-ham-ni-da,” and bowed his head slightly.
Kim said she’d rule in the case Jan. 31, which is expected to be the final session in the trial.
Prosecutors accused Jeong of paying Choy $100,000 to help win the contract and of later paying Holloway $68,000 to help shield the firm from trouble with AAFES over mounting customer complaints.
AAFES initially awarded SSRT the $206 million, 10-year contract in 2001, but by May 2003 SSRT became the subject of repeated customer complaints of alleged price gouging and chronically poor service.
In 2003, AAFES extended the contract with the company from 2011 to 2019.
On Jan. 31, 2007, SSRT transferred the rights to its contract with AAFES to LG Dacom through a legal process called novation, used when a company can no longer fulfill its contract.
The alleged bribes were in cash plus paid entertainment at South Korean bars, restaurants and other venues, according to South Korean authorities and witness testimony.
In addition, Jeong allegedly arranged an under-the-table stock deal for Holloway that was later shelved and subsequently earmarked $65,000 to buy a BMW luxury car for Holloway.
Holloway’s last AAFES position was as general manager at Fort Benning, Ga. At Osan Air Base in South Korea, he was AAFES general manager from June 2000 through August 2005.
His AAFES employment ended Jan. 11, 2007, after nearly 17 years.
Choy was service program manager at AAFES’ Pacific headquarters on Camp Foster, Okinawa, from February 2005 until his employment ended Feb. 17 after 36 years.
AAFES officials have declined to divulge why Holloway’s and Choy’s employment ended, citing privacy rules.
Choy and Holloway have declined to be interviewed by Stars and Stripes.
U.S. Air Force investigators have completed probes into the allegations against Holloway and Choy and have sent their findings to federal prosecutors who will decide whether further action is warranted.
Stars and Stripes reporter Hwang Hae-rym contributed to this report.