(CN) - A federal judge approved deferred prosecution agreements for two companies accused of bribing U.S. Army officials to win government contracts.
Last year, former U.S. Army contracting officials Kerry Khan and Seon Lim were arrested on charges that they accepted $23 million in bribes in exchange for steering business to favored contractors.
Saena Tech and Intelligent Decisions were involved in the bribery scandal, and entered into deferred prosecution agreements with the government.
U.S. District Judge Emmet Sullivan explained the reasoning behind deferred prosecution in his 84-page opinion.
"The concept is simple: The government intends to prosecute a defendant for criminal wrongdoing, but decides that the defendant is worthy of a chance at rehabilitation and avoiding the collateral consequences that accompany a criminal conviction. Rather than seeking a conviction through a trial or guilty plea, the government agrees to defer prosecution for a period of time during which the defendant will be monitored for compliance with various conditions, in an attempt to assess the defendant's rehabilitation. If the defendant succeeds, the government does not prosecute. If the defendant does not succeed, the government may prosecute."
Intelligent Decisions agreed to pay a fine and institute various compliance measures, and in return the government deferred prosecution for a period of two years - after which it will dismiss all charges if the firm remains compliant.
Saena Tech agreed to a similar stipulation, but additionally agreed that its CEO Jin Seok Kim - who personally paid the bribes - shall be a party to the deferred prosecution agreement.
This agreement essentially immunizes Kim from criminal prosecution unless he fails to cooperate with the government's investigation.
Despite the unusual arrangement, Sullivan approved both deferred-prosecution agreements on Wednesday.
"The court finds that approval of a deferred-prosecution agreement should be granted under the Speedy Trial Act when the agreement is intended to hold prosecution in abeyance while a defendant demonstrates good conduct," Sullivan said.
He said he had limited power to review the contents of the agreement, which went only as far as to keep courts from becoming accomplices in illegal actions.
He also noted that the Saena Tech agreement was "nontraditional," but that there were barriers to prosecuting Kim, a Korean national, that may have influenced the government's decision in this case.
"The agreements in these cases, although somewhat troubling to the court in the Saena Tech case, do not implicate the integrity of the court. For that reason, the court will approve both agreements and grant the requested exclusion of time under the Speedy Trial Act," Sullivan said.
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