NEWPORT NEWS, Va. - A Newport News attorney is facing tax fraud charges after her husband was sentenced for his role in an elaborate scheme that wrongly awarded millions in government contracts to his company.
Federal prosecutors allege that these crimes took place from 2011 to 2018.
According to a statement from the US Attorney’s Office, Iris Kim, Inc., (aka “I-Tek”) owner Beyung S. Kim, 62, of Newport News, and employees Seung Kim, 31, of Newport News; Dongjin Park, 54, of Yorktown; Chang You, 62, of Yorktown; Pyongkon Pak, 53, of Toano; and Li-Ling Tu, 58, of China, engaged in a conspiracy and scheme related to certain government contracts for which I-Tek acted as a supplier of goods, including items for the U.S. Marine Corps, U.S. Army, U.S. Coast Guard and the National Guards of various states, among other agencies.
They were sentenced last August.
Federal prosecutors say the owner was sentenced to 58 months in prison, and his four employees were sentenced to a combined 93 months.
Now his wife and local lawyer Nosuk Kim is facing new tax fraud charges.
Court documents state that I-Tek got $7 million in government contracts that were supposed to be for disabled veterans and required items to be made in America.
It states the group supplied clothing, promotional items and equipment to the military and would switch the labels to hide the fact that they were coming from China.
According to federal prosecutors, Beyung Kim and the employees obtained government contracts that had certain set-aside preferences and source-of-good requirements. They said the conspirators acted to defraud the U.S. and commit other substantive offenses by fraudulently importing goods into the U.S. that were made in China in violation of the terms of these contracts. They said they then falsely relabeled these goods as if they were made in the U.S.
Kim and his employees also acted through a separate nominee company to conceal the importing of goods from China and installed a nominee officer of I-Tek in order to be able to fraudulently qualify for contracts set aside for service-disabled veterans.
They said the conspirators also submitted false documents and further falsely classified the value of the goods imported into the U.S. to avoid higher duties and taxes.
“The defendants’ egregious scheme caused the U.S. government to spend over $7 million on fraudulently imported goods. These funds were intended for deserving beneficiaries, including American workers, service-disabled veterans, and authorized trading partners,” said Acting U.S. Attorney Raj Parekh for the Eastern District of Virginia. “This prosecution demonstrates our firm commitment to holding accountable those who defraud our military and brazenly disregard laws that are designed to protect the strength of our country’s infrastructure and manufacturing base.”
Law enforcement say the scheme threatened the readiness and safety of the military, defrauded taxpayers and damaged the integrity of the entire process all to make a profit.
We reached out to Kim's attorney regarding the new tax fraud charges. He said they are not in a position to comment on pending litigation.
Kim has her next court hearing coming up on July 28th.
