ROCKVILLE, Md. — He was supposed to help business startups grow. Instead, a former Montgomery County employee admitted that he stole $6.7 million from the county’s Department of Economic Development.
Byung Il Bang, 58, who also went by the name Peter Bang, pleaded guilty in U.S. District Court and Montgomery County Circuit Court to forming a fake business incubator that went by the name Chungbuk Incubator Fund LLC.
According to prosecutors, Bang, as the chief operating officer of the Montgomery County Department of Economic Development, authorized the county’s Department of Finance to issue checks into bank accounts he controlled. This went on from 2010 through 2016.
The county had already entered into an agreement with a South Korean province, Chungcheongbuk-Do, and Montgomery County assistant state’s attorney said in court that Bang used the name Chungbuk Incubator Fund as “a name used to provide a veneer of legitimacy” to his scheme.
Prosecutors said — and Bang admitted — to using the money to feed a gambling habit.
The scheme that went on while Bang worked for the county government wasn’t revealed until the casinos where Bang liked to gamble flagged the activity in their statements to the IRS.
Bang faces up to 20 years in prison on the felony count in circuit court, and faces another potential 20 years on a federal charge. He also faces having to make restitution, despite the fact that Montgomery County State’s Attorney John McCarthy said there’s no evidence that there is any money left in Bang’s accounts.
Montgomery County Executive Ike Leggett issued a statement saying that Bang acted alone and took advantage of county procurement regulations that have since been beefed up.
In the statement, Leggett said the county had hired an auditing firm last year to review Bang’s transactions while he headed the county department going back 10 years.
“As a result of this theft, I initiated a process to fully address the factors that allowed the individual to evade the normal controls and processes that exist to prevent fraud and abuse in county programs, and to strengthen those controls and processes,” Leggett said.
Since Bang’s scheme was exposed, Leggett said a number of measures have been taken, including strengthening the separation of duties within departments, more oversight over payment processing and increased training of county managers.
“As to recovering the stolen monies, the county, working with the federal and state authorities, will use all means at our disposal. Loss insurance held by the county will replace some of the money. We are aggressively looking for the balance in any other accounts or properties held by Mr. Bang,” Leggett added.
Bang, who lives in Germantown, Maryland, was released on his own recognizance and faces sentencing in the federal case on Feb. 22. He will be sentenced in Montgomery County Circuit Court on March 7.
Noting that he was being released pending sentencing, Montgomery County Circuit Court Judge Cheryl McCally warned Bang to make sure that he abides by the terms of his release, saying, “Mr. Bang, don’t test the court on this issue.” She added that if he failed to meet all the conditions of his release, she would issue a warrant and have him held without bond.