Prosecutors search KAI offices over corruption

The headquarters of the Korea Aerospace Industries in Sacheon, South Gyeongsang Province / Yonhap

Fight against ‘the enemies within’ has begun

By Jung Min-ho

Prosecutors searched the offices of Korea Aerospace Industries (KAI), Friday, on corruption allegations in aircraft development projects.

According to the Seoul Central District Prosecutors’ Office, dozens of investigators searched the defense company’s headquarters in Sacheon, South Gyeongsang Province, and its Seoul office over allegations it inflated product development costs to reap greater profits.

This came amid high expectations for President Moon Jae-in’s pledge to root out corruption in the nation’s military.

Investigators have confiscated accounting documents, computer hard disks and the mobile phones of KAI officials, but they did not specify suspects or their charges.

The latest clue came out in 2015, when the Board of Audit and Inspection (BAI) revealed KAI officials illegally acquired 54.7 billion won ($48 million) by inflating development costs for the Surion helicopter. Based on the fake costs, the BAI noted, they set up their own firms outside the company and took taxpayers’ money through business contracts with KAI.

“We are not investigating one specific target. We are looking into all the allegations brought up against the company,” a prosecution official said.

One of the suspects may be KAI President and CEO Ha Sung-yong, who is accused of having embezzled the company’s money and bribed some aides of disgraced former President Park Geun-hye.

Prosecutors have reportedly secured clues suggesting a dodgy connection between him and three former presidential secretaries ― Ahn Bong-geun, Jung Ho-sung and Lee Jae-man.

If prosecutors collect strong evidence of the bribery allegation, the investigation may expand ― again ― to key officials of the Park administration.

Ha and several other top-ranking KAI officials have been banned from traveling overseas during the investigation. They are expected to face questioning soon.

KAI, the country’s sole aircraft manufacturer, has been involved in various defense-related projects, including the Surion, T-50 supersonic trainer jet and FA-50 light attack fighter.

A KAI official denied all the allegations, saying none of its business deals were illegal.

Since the 1950-53 Korean War, the nation’s military has fought two enemies mainly: one is the rancorous regime in the North and the other is corruption which has been weakening its defenses.

Eradicating corruption in the military was one of the key promises of President Moon, who knows of rampant illegal business practices in the weapons acquisition sectors and the public’s fatigue toward such news.