The brother and nephew of former United Nations Secretary-General Ban Ki-moon were charged Tuesday with FCPA and other offenses in connection with the planned $800 million sale of Vietnam's tallest building.
Ban Ki Sang, 69, of Seoul, South Korea and his son Joo Hyun Bahn, who also goes by Dennis Bahn, 38, of Tenafly, New Jersey, were each charged in federal court in Manhattan.
They face one count of conspiracy to violate the Foreign Corrupt Practices Act, three counts of violating the FCPA, one count of conspiracy to commit money laundering, and one count of money laundering.
Dennis Bahn was arrested in Tenafly Tuesday morning and released on bail. He also faces an additional charge of aggravated identity theft.
His father remains at large, the DOJ said.
The building in Vietnam is known as Hanoi Landmark 72. It opened in 2012. It includes two 50-storey office buildings and one 72-floor tower, the tallest building in Vietnam. There are apartments, offices, and hotels in the complex.
Landmark 72 was owned by Keangnam Enterprises Co. Ban Ki Sang was a senior executive at Keangnam. When the company faced a liquidity crisis, the DOJ said, Ban convinced Keangnam to retain his son, who worked as a broker at a Manhattan real estate firm.
Keangnam entered into an exclusive brokerage agreement with Dennis Bahn. He stood to earn a multimillion-dollar commission for finding an investor to finance the $800 million sale, the DOJ said. And his father's company would have received much-needed capital.
The father and son plotted to bribe Malcolm Harris, who claimed to be an agent for a foreign official of a Middle Eastern country. The DOJ didn't name the official or the country.
Harris allegedly agreed to take bribes of $500,000 upfront and $2 million more on closing of the Landmark 72 sale to the Middle Eastern country's sovereign wealth fund.
Prosecutors said a fourth man, San Woo, also known as John Woo, 35, of Edgewater, New Jersey, allegedly helped secure the $500,000 for the upfront bribe.
But prosecutors said Harris cheated Ban, his son, and Woo, and stole the $500,000. He used the money to rent a luxury penthouse apartment in Williamsburg, Brooklyn, and for other personal expenses, the DOJ said.
When the Landmark 72 deal stalled, Dennis Bahn lied to Keangnam. He allegedly forged emails from the purported foreign official and other documents to make the sale seem imminent, the DOJ said. He also allegedly stole $225,000 of the $500,000 that Keangnam had advanced Bahn’s firm to cover brokerage expenses.
The DOJ charged Harris Tuesday with wire fraud, conducting monetary transactions in illegal funds, and aggravated identity theft. He's still at large.
Woo was charged in a separate complaint with conspiracy to violate the FCPA. He was arrested at New York's JFK Airport Tuesday and released on bail.
When the Landmark 72 sale didn't happen, Keangnam was forced into receivership and delisted from the Korean stock exchange.
The chairman of the company, Sung Woan-jong, committed suicide in April 2015 after being investigated for alleged corruption. He reportedly left a list of politicians in Korea he claimed to have bribed.
Ban Ki-moon served as UN Secretary General from 2007 until 2016. He was expected to announce later this week a run for the presidency of South Korea. A spokesman said Ban was unaware of the circumstances surrounding the allegations against his relatives.
Richard L. Cassin is the publisher and editor of the FCPA Blog.