Two years ago this month, Alex Cho, a chief technology officer at a Northern Virginia contracting company, went undercover for the FBI.
For seven months, he talked with agents just about every day, wearing a wire to collect evidence in an investigation that produced historic results: the dismantling of the biggest bribery schemes in federal contracting history.
But with the ringleader and other co-defendants in the $30 million scam already sentenced, Cho’s fate remains uncertain after pleading guilty to bribery charges in 2011.
In a court filing this week, his attorney says the Justice Department now is reneging on key promises prosecutors made to his client to secure his cooperation in the first place — including helping him avoid deportation.
“The United States Attorney's Office for the District of Columbia now sends not just to the key cooperator in the most successful bribery case it has ever handled, but to all potential cooperators, an important message: don’t trust what we tell you,” defense attorney William Cowden wrote in a sharply worded memo late Tuesday.
Prosecutors say it was Cho who broke their trust.
The dispute marks a sharp falling-out between prosecutors and the contracting executive who took agents into a stunningly corrupt ring of Army Corps of Engineers officials.
Cho’s case also shows how fast informants hoping for leniency by working undercover can fall out of favor by the time their own sentencings approach — which can be years after their cooperation ends.
Alexandra Natapoff, a professor at Loyola Law School in Los Angeles who has written extensively on federal cooperation deals, said it’s not surprising to see prosecutors reject claims from once-valuable informants.
“In the marketplace of cooperation, for the most part, the government holds all the cards because they control so much of the process,” she said.
Cho’s case also reveals how prosecutors can use a defendant’s immigration status to persuade him to plead guilty and cooperate.
“The government is well known for holding out the promise of immigration assistance to essential cooperators and then not come through on those promises,” Ms. Natapoff said. “There have been a number of recent stories in the media where people have cooperated in hopes of getting a visa.”
Sentencing papers don’t indicate Cho’s native country, but the name usually indicates Korean ethnicity. His attorney said in court filings that U.S. Attorney Ron Machen agreed in the plea deal to intercede with U.S. Immigration and Customs Enforcement officials who will be weighing whether to deport Cho.
Mr. Cowden wants a judge to hold a hearing to prove that prosecutors made that deal among several “side agreements” with Cho — agreements his attorneys said the government is now violating.
According to the defense attorney, Mr. Machen promised his personal intervention for Cho but told his prosecutors not to reveal that in Cho’s plea agreement.
Bill Miller, spokesman for Mr. Machen, declined to comment but pointed to court pleadings filed by prosecutors that tell another side of the story.
In one memo, prosecutors say Cho violated their deal by tipping off an associate that he was wearing a wire during the investigation, thus obstructing their investigation.
But Mr. Cowden argued it’s not obstruction of justice to keep someone from committing a crime. Either way, the associate pleaded guilty.
Prosecutors also say Cho concealed information about the involvement of a person described only as Public Official C in court papers.
Cho is set to be sentenced in late March.
The ringleader in the case, Kerry Khan, 56, a former Army Corps program manager, was sentenced to more than 19 years in prison in June and has begun serving his sentence.
When he was arrested, Khan was planning to steer a nearly $1 billion contract to a corrupt contractor. Prosecutors say he used millions of dollars in kickbacks to finance an opulent lifestyle, buying a dozen properties and jetting around the world.
Before Cho’s involvement, however, the investigation was a typical fraud case involving bogus performance reports used to win government contracts. But the paper trail eventually took agents to contractor Nova Datacom LLC, a now defunct technology contractor based in Virginia where Cho was chief technology officer.
The scam began in 2006 as Khan and another Army Corps official, Michael Alexander, steered contracts to corrupt companies in exchange for kickbacks. From Nova Datacom alone, Khan received more than $11 million, according to court records.
The corruption went undetected for years because Khan essentially built the bribes into the contracts, telling contractors to inflate overhead charges. On the surface, nobody ever raised any concerns until Cho alerted authorities, Mr. Cowden wrote in one memo explaining the scam.
In the criminal organization that prosecutors would later dub Khan Inc., the Army Corps‘ program manager’s brother and son also pleaded guilty in the case.
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