This article is by James Glanz, Eric Schmitt and Choe Sang-hun.
In a case that opens a new front in the rapidly expanding investigation of corruption in Iraq, three South Korean military officers have been convicted of leading an extortion and bribery scheme in a reconstruction program in northern Iraq that was financed with over $70 million of United States taxpayer money, according to senior American and Korean officials.
A fourth officer, a colonel who served as the head of all reconstruction efforts for the Korean Army, which was deployed near the Kurdish city of Erbil until December, received a military reprimand for failure to perform his duties properly. A senior American official said that the inquiry was widening to include the possible involvement of Kurdish-American translators and Kurdish government officials.
The case has generated tensions with a staunch American ally and raised new questions about the scale of corruption in Iraq. Earlier cases revealed extensive evidence of financial misdeeds by Iraqi and American officials and military officers. The convictions of the Koreans in a military court in Seoul last month are the first sign that the $50 billion American-financed reconstruction program was also effectively being robbed by American allies in the war.
Within South Korea, the case also threatens to further tarnish a mission that represented the largest overseas deployment of South Korean troops since they fought alongside the United States in Vietnam, but was politically unpopular at home. The case is seen as deeply embarrassing by Korean military and civilian officials, who partly justified the mission as a necessary show of loyalty to the United States.
“There is no doubt that this is a shameful incident,” a Korean Defense Ministry official said. “Our unit had done an honorable job during its four-year-and-three-month stay in Iraq. We hope that these few people did not damage that record.”
Although the convictions for accepting bribes of more than $25,000 in one branch of the scheme became official last month, they have not been previously reported in the West.
South Korea is already receiving intense criticism in Iraq for signing lucrative oil contracts with the Kurdish regional government that the Iraqi Oil Ministry in Baghdad regards as illegal. The contracts include a swap of the right to pump in the rich northern oil fields for a pledge that Korean companies will invest more than $2 billion into rebuilding the Kurdish infrastructure.
Eager to build support for the Iraq mission domestically, Korean leaders explicitly told their people that the deployment would help their country gain oil contracts. But Baghdad, which has failed to reach agreement with the Kurds on a national oil law, was angered by the deals and has placed onerous sanctions on the Korean companies that signed them.
The South Koreans were an important part of the American-led force after they deployed to Camp Zaytun in the fall of 2004, with some 19,000 troops rotating through Iraq. The Koreans were the second largest partner in the force after Britain, but partly because of the contentious nature of the mission, Korea sent noncombat units that focused on medical issues and reconstruction.
The Americans gave the Zaytun unit wide latitude within its northern area of operation. The unit largely controlled the disbursement of $74 million of American reconstruction money through the Commanders’ Emergency Response Program, or CERP. In addition, the South Korean government gave the unit about $88 million for the medical and reconstruction programs.
The Korean government has long depicted those programs as a success; the Defense Ministry, for example, said recently that more than 88,000 Iraqis were treated in the Zaytun Hospital and that more than 2,000 were trained in the use of computers and in other skills. Korean officers gave visitors to Zaytun elaborate presentations on their rebuilding program.
And in an interview last month, Nawzad Hadi, the governor of the Kurdish province containing Erbil, praised the Korean projects there as “useful and good,” and said “The Korean military treats our citizens well.”
But American investigators saw a different picture. Early last year a team of auditors, inspectors and engineers from the special inspector general’s office visited two primary schools built around Erbil with about $1.3 million of CERP money.
Although the team members found no serious problems with the construction, they were surprised to discover that the Korean officers who doled out the money apparently had no training or expertise in contracting, suggesting a cavalier treatment of American funds.
A full investigation at Zaytun in September and October eventually involved the inspector general’s office, the Army Criminal Investigation Command, the Defense Criminal Investigative Service, and a South Korean team consisting of three military investigators and two engineers.
The investigators found evidence that an officer whom the Defense Ministry, according to Korean custom, will identify only as Captain Park, was engaged in an elaborate shakedown of a Kurdish contractor, which was eventually awarded about $5 million in contracts. Captain Park used a combination of threats and incentives: he threatened to terminate contracts, and also offered to ease inspections or extend deadlines.
Captain Park told the Kurdish contractor that he spoke for the entire group of Korean contracting officers. In the series of shakedowns investigators focused on, Captain Park was ultimately given $25,000 in cash and a digital camera worth about $800.
Captain Park was found guilty of demanding bribes from 10 local contractors, although he actually received just the one payment before he learned of the investigation. Captain Park received three years in a military prison and two of his co-conspirators — Sgt. Major Kim and Major Lee — received lesser sentences. All the convictions are under appeal.
Besides the colonel who led the reconstruction program and received a military reprimand, a fifth officer, a lieutenant colonel, was acquitted in the case.
Although American and Korean investigators cooperated in the inquiry, the convictions have created awkward strains among some officials.
The Korean Defense Ministry official insisted that the bribes did not involve a theft of American money, because the shakedowns happened after the contracts were awarded. “He got the money from the company,” the official said of Captain Park.
But a senior American official said that the scheme involved kickbacks and bribes with the contract money. “It was a clear case of extortion between the Kurds and the Koreans,” the official said.