Title: “Northern Mariana Islands Business Owner Sentenced for Bank Fraud and Money Laundering Scheme”
Date: May 6, 2024
Contact: newsroom@ci.irs.gov
Hagatña, Guam – Sentencing of a Korean Air Lines Administrator for Financial Crimes
In a high-profile case of corporate fraud, Sung Peel Hwang, a South Korean national and naturalized US citizen, was sentenced to serve 41 months in federal prison by the District Court of Guam. Hwang, formerly an administrator at the Guam office of Korean Air Lines (KAL), was convicted of Bank Fraud and Money Laundering charges.
Three-Year Scheme of Embezzlement and Underreporting
From September 2015 to December 2018, Hwang, 52, devised an intricate plan to defraud his employer and embezzle over $600,000. In his role as an administrator at KAL’s Guam office at Guam International Airport, Hwang was responsible for reporting the number of passengers on flights and making the corresponding Passenger Facility Charge (PFC) payments to GIAA. He also managed office supplies, services, and was one of two co-signatories on KAL Guam’s business checking account at Bank of Guam.
Illicit Activities: Underreporting and Personally Depositing Company Funds
Hwang’s illicit activities involved underreporting the PFC owed to GIAA and pocketing the difference. Throughout the three-year scheme, Hwang deposited more than $3.5 million of KAL funds into his personal account and siphoned off over $600,000 for his personal use. In total, the alleged losses amounted to approximately $615,272.
Impacted Entities: KAL and GIAA
“Mr. Hwang engaged in a deceitful scheme that cost his employer and GIAA a substantial loss,” stated Shawn N. Anderson, United States Attorney for the Districts of Guam and the Northern Mariana Islands.
Accountability and Deterrent
Anderson continued, “This sentence serves as a clear message of accountability and a deterrent to others contemplating such dishonest actions.”
IRS Criminal Investigation’s Role
Special Agent in Charge, Adam Jobes, from the IRS Criminal Investigation (CI), remarked, “The IRS is committed to combating financial crimes that threaten our communities’ trust and security. Mr. Hwang’s greed-driven actions have caused harm, and today’s sentencing demonstrates that we will hold fraudsters accountable.”
Federal Bureau of Investigation’s Role
Special Agent in Charge, Steven Merrill, from the FBI Guam Resident Agency, emphasized the importance of investigating financial crimes: “The FBI is dedicated to addressing financial crimes, such as those committed by Mr. Hwang. The consequences of his actions not only affected KAL but also impacted the broader community, and this sentence should serve as a reminder to others contemplating similar criminal acts.”
Joint Investigation
The joint investigation into Hwang’s criminal activities was carried out by CI and the FBI Guam Resident Agency. Assistant United States Attorney Benjamin K. Petersburg represented the prosecution. CI is the criminal investigative arm of the IRS and is responsible for investigating various financial crimes, including tax fraud, public corruption, money laundering, and identity theft.
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