Pleading guilty to campaign finance fraud, the American subsidiary of South Korean conglomerate Haitai International paid a $400,000 fine Monday for illegally laundering a $2,800 contribution to the election campaign of Rep. Jay C. Kim (R-Diamond Bar).
In a plea agreement with the government, the company also admitted that three top officers tried to obstruct an FBI investigation into the illicit donations.
Haitai America, based in Montebello, is the fifth major South Korea-based company to plead guilty in the case.
Kim, the first Korean American elected to Congress, has not been charged with any crime, although his attorney has said the congressman considers himself to be a prime target in the FBI's 4-year-old investigation.
Appearing before U.S. District Court Judge John G. Davies, Haitai America President Taeki Min admitted that the company made an illegal corporate campaign contribution and disguised its source. Both counts are misdemeanors.
Under federal election law, it is illegal for corporations to contribute to candidates for federal office and illegal for any contributor to conceal his identity.
Haitai America, an exporter-importer of everything from electronic equipment to chewing gum, was accused of funneling the contribution to Kim's 1992 election campaign through three employee conduits.
The employees wrote checks to the campaign on their personal accounts and were reimbursed by the company for bogus expenses.
When contacted by the FBI two years later, company President Byong Ho Kim, General Manager Hyun Sik Joo and Brian Yeon Soon Chang, manager of the company's international trade division, conspired to lie about the money laundering, according to the plea agreement.
Under terms of the agreement, however, none of the officers or employees involved in the case were charged with criminal wrongdoing.
In an interview last week, Chang said he and the others lied to protect the company's name and because they were frightened. But after receiving federal subpoenas, he said, they consulted a criminal defense attorney who advised them to tell the truth.
In pleading guilty, Haitai America joined the ranks of other corporations that were fined for making illegal contributions to Kim's congressional campaign. Hyundai Motor America was fined $600,000; Korean Airlines, $250,000; Daewoo International America, $200,000, and Samsung America, $150,000.
Haitai's $400,000 fine was the maximum allowed under federal sentencing guidelines.
Kim has said that any illegal contributions were made without his knowledge. He said he plans to give Haitai's $2,800 to the U.S. Treasury.