$6.7M Theft Sends Montgomery County Official To Prison

GERMANTOWN, MD — A former Montgomery County official who admitted to embezzling more than $6.7 million in county funds was sentenced Friday to four years in prison.

Byung Il "Peter" Bang, 59, was the chief operating officer of the Department of Economic Development for the county from 2010 to 2016. Within Bang's first year as department head, Montgomery County and South Korea agreed to create an incubator fund called Chungbuk Incubator Fund LLC. Federal officials said Bang opened four banks under the company's name and listed his home address as the business' address.

In a span of six years, the former department head fraudulently funneled $6,705,669.37 from the county government to the bank accounts he created and managed, prosecutors said.

According to the Justice Department, $5,447,964 came from the Montgomery County Department of Finance; $1,213,987.63 came from the Maryland Economic Development Corporation; and $43,717.74 came from the Maryland Conference & Visitors Bureau.

Bang did not report those funds as income and owed the IRS $2,335,913 in taxes.

On Nov. 16, the Germantown resident pleaded guilty to wire and tax fraud charges — saying that most of the funds were used to fuel his gambling addiction.

"Mr. Bang lied to his colleagues, government officials and the IRS over an extended period of time. The $6.7 million that he embezzled deprived Montgomery County taxpayers of funds that could have been used for schools, libraries, and other expenditures, and harmed the County's reputation," said U.S. Attorney Robert K. Hur. "Corrupt public employees undermine everyone's faith in government."

After learning about Bang's actions, Ike Leggett — who was county executive at the time — said he had implemented a program to prevent fraud and abuse in county government. Some initiatives included creating a new "Compliance Unit" within the Department of Finance, training all county managers, and increasing oversight over payment processing.

Following these revelations, the county's inspector general also issued a report 158-page report that detailed how Bang got away with wire and tax fraud. The audit stated that an agreement between Montgomery County and the Maryland Economic Development Corporation allowed Bang to make these major financial decisions with little oversight or authorization from the county.

The report also said that management did not segregate key roles within the department. Segregating essential duties, according to the inspector general, lowers the risk of error, misuse, and fraud.

Bang was fired from county government in 2017.

On Friday, U.S. District Judge Paula Xinis sentenced Bang to four years in prison, followed by three years of supervised release.

Montgomery County State's Attorney John McCarthy expressed his support for the ruling.

"Through strong Federal and County cooperation and investigation we were able to bring Mr. Bang to justice. It is important that people who betray the public trust be held accountable. Today's sentence is the next step in our effort to close this chapter of greed and corruption in the career and life of Byung Il 'Peter' Bang," McCarthy said.

U.S. District Judge Paula Xinis will finalize Bang's sentencing concerning restitution and forfeiture on March 1.