South Korean defense company that paid Michael Cohen is poised to win part of a $16 billion Pentagon deal

Key Points
  • A South Korean defense company paid $150,000 to Essential Consultants, a firm set up by President Donald Trump's personal lawyer Michael Cohen.
  • KAI partnered with Lockheed Martin to build the T-50A trainer jet in hopes of securing a U.S. Air Force contract worth roughly $16 billion.
  • The T-X trainer program award is the Air Force's largest ongoing aircraft competition.
The T-50A, Lockheed Martin's offering for the next generation trainer for the U.S. Air Force, performs a flying display display at the Joint Base Andrews Air Show.
Lockheed Martin

A South Korean aviation firm with ties to President Donald Trump's personal lawyer, Michael Cohen, is poised to win part of a multibillion-dollar Pentagon contract.

Korea Aerospace Industries, or KAI, paid $150,000 to Cohen's company, Essential Consultants, for "legal consulting concerning accounting standards on production costs," a KAI representative told Reuters. Cohen's work with KAI lasted less than six months and ended in November.

KAI did not respond to multiple requests for comment from CNBC.

The revelations about KAI's relationship with Cohen came after Michael Avenatti — the lawyer for adult film star Stormy Daniels, who is suing Cohen and Trump — released documents that said Essential Consultants received hundreds of thousands of dollars from individuals and companies. Telecom giant AT&T and Swiss pharmaceutical firm Novartis have also acknowledged paying Cohen's firm for consulting services meant to give an insight into Trump's approach to policy.

Meanwhile, KAI partnered with Lockheed Martin to offer the T-50A jet for the U.S. Air Force's trainer competition. The plane is a version of KAI's T-50, which is used in South Korea as well as several other U.S. partner nations.

The T-X trainer program award, the Air Force's largest ongoing aircraft competition at roughly $16 billion for the delivery of 350 aircraft, is expected to be announced this summer. The trainer aircraft will replace the Air Force's aging T-38 trainers that have been in the U.S. military's portfolio since the 1960s.

A South Korean Air Force T-50 trainer jet, developed by Korea Aerospace Industries Ltd. and Lockheed Martin Corp.
SeongJoon Cho | Bloomberg | Getty Images

When asked if KAI's dealings with Cohen or a corruption investigation involving the Korean firm's leadership would impact the U.S. Air Force's selection, Lt. Gen. Arnold Bunch said the service branch is "letting the contract process play out."

"We are working through all the legal and letting them do all that work. We'll just let that process play through the source selection," Bunch, the Air Force's top acquisition officer, told reporters last week at the Pentagon.

Lockheed Martin, the Pentagon's top weapons supplier, told CNBC that nothing has changed with their bid for the Air Force's trainer award.

"We had no knowledge of a business relationship between Korea Aerospace Industries and Mr. Cohen, and are not aware of any connection that it may have to the U.S. Air Force Advanced Pilot Training competition," Lockheed told CNBC in a previous statement.

Boeing, which partnered with Swedish aerospace firm Saab, is also in the running for the lucrative Air Force contract.

White House addresses AT&T payment to Michael Cohen
White House addresses AT&T payment to Michael Cohen