Examiner reader tip leads to figure in $20m contracting scandal
By: Scott McCabe
Examiner Staff Writer
http://washingtonexaminer.com/local/2011/10/exmainer-reader-tip-leads-figure-20m-contracting-scandal#ixzz1awqe0teY
.A man connected to what might be the largest federal contracting scam in history originally came to police attention after being arrested on a tip from a reader of The Washington Examiner.
Ferose Kerry Khan, 30, had been on the run for several months last year and was toying with U.S. marshals, calling their office hot line and telling them that he'd turn himself in when he was ready. He was wanted on charges of felony drug trafficking, attempted bribery of a law enforcement officer and impersonating a police officer.
Marshals caught up to Khan after an Examiner reader saw his story and mugshot and called in a tip.
Authorities said Khan threatened his family members, saying he's exposing their scheme to embezzle $20 million from the U.S. Army Corps of Engineers.
Khan's father, Army Corps contracting manager Kerry F. Khan, and Khan's brother, Lee A. Khan, were among four Northern Virginia men arrested Tuesday as part of a two-year multiagency investigation into the alleged theft of $20 million from the Army Corps.
Prosecutors were hesitant to talk about Ferose Khan's role in helping to unravel the elaborate contracting scheme and would not publicly identify him.
Authorities said the Khans were part of a "staggering" scheme in which the conspirators steered no-bid contractors worth tens of millions of dollars to favored businesses and lined their pockets with up to $20 million in tax money.
While in jail, Ferose Khan began corresponding with his brother and father, a contracting manager with the U.S. Army Corps of Engineers. On Aug. 22, Ferose sent a letter threatening to cooperate with authorities if his family did not pay up.
"Tell Kerry, he has until September 2 to deposit the entire cost of my house and 4 cars into my TD bank account, or I will enter an agreement with the federal government," he wrote.
Over the next four days, Kerry Khan and Lee Khan moved hundreds of thousands of dollars to the family trust account to pay Ferose Khan.
Ronald Machen Jr., U.S. attorney for the District of Columbia, declined to elaborate Tuesday what role Ferose Khan played in helping to unravel the contracting scheme.
He said federal authorities were already investigating the contracting scheme when the family member began making his threats to expose the contracting scheme.
"We really want to stick to the four corners of the indictment," Machen said.
Ferose Khan pleaded guilty to the felony drug charges on Aug. 19, and was sentenced to five years. As part of his plea he agreed to cooperate with the government and provide information to any criminal activity requested by authorities.