A Virginia-based company with defense and intelligence agency contracts is facing criminal charges that it paid a corrupt Army procurement official who was recently sent to prison for taking kickbacks.
The U.S. attorney’s office in Washington filed two criminal counts against Intelligent Decisions Inc., accusing the company of providing golf outings, meals, entertainment and a vehicle worth more than $30,000 to former Army contracting official In Seon Lim, who was sentenced to four years in prison last week.
The kickback scheme came to light in a bigger bid-rigging investigation at the Army Corps of Engineers, where one former program manager, Kerry Kahn, oversaw a $30 million bribery scheme. Khan is serving 17 years in prison.
It’s unclear whether Intelligent Decisions could lose out on future government contracts because of the charges.
The company has been ranked by the Washington Business Journal as one of the area’s fastest-growing firms, but it moved fast in recent days to announce a leadership shake-up.
The company didn’t say whether it planned to plead guilty or fight the criminal charges, which were filed earlier this month but have not been announced. The firm said in a statement Thursday that officials had cooperated with the Justice Department.
Former chief executive Harry Martin “took the initiative” to report “improper gratuities” paid to a former Defense Department official , according to the statement, which didn’t identify Lim. But the former Army official is mentioned by name in charging documents against Intelligent Decisions.
“Although these violations occurred five years ago, Intelligent Decisions views any failure to conduct our business according to the strictest legal and ethical standards as a serious matter,” said newly named Chief Executive Joe Armstrong, who was previously the firm’s top financial officer.
“We have learned a great deal from this experience, and we are focused now on moving forward and delivering exceptional service and support to our valued clients,” Mr. Armstrong said.
The company also said it was beefing up its internal compliance program. Such moves are typical when government contractors find themselves accused of wrongdoing.
Under procurement law, agencies are only allowed to do business with contractors that are “presently responsible,” and so companies change leadership and enact more stringent ethics programs as a way to prove responsibility and remain eligible for future work.
In a related case, federal prosecutors on Wednesday filed a motion for “downward departure” to give a sentencing break to King Everett Johnson, a former employee of Intelligent Decisions who was involved in the bribe scam.
Citing Johnson’s cooperation in the case, prosecutors are seeking a six- to 12-month prison sentence.