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Lee Myung-bak’s Blue House officials suspected of illegally receiving NIS funds

Prosecutors requested arrest warrants on Jan. 14 for Kim Baek-joon and Kim Jin-mo in connection with their investigation into illicit National Intelligence Service (NIS) payments to the Blue House under former President Lee Myung-bak (2008–13). Kim Baek-joon, 78, is a former Blue House general affairs and planning secretary popularly known as Lee’s “steward,” while Kim Jin-mo, 52, is a former Seoul Nambu District Prosecutors’ Office chief who served as Blue House second civil affairs secretary during the Lee administration.

As with the case of NIS “special activity fund” diversions during the Park Geun-hye presidency (2013–16), prosecutors characterized the payments as bribes and charges the two men with bribe acceptance according to the Act on the Aggravated Punishment, etc. of Specific Crimes.

The investigation, which kicked off in earnest on Jan. 12 with surprise raids on the two former Blue House secretaries’ homes and offices, is now gathering swift momentum with the simultaneous questioning of key figures and arrest warrant requests.

The second special investigation division of Seoul Central District Prosecutors’ Office, headed by senior prosecutor Song Gyeong-ho, requested a preliminary arrest warrant against Kim Baek-joon that day on charges of bribe acceptance and causing losses to state funds according to the Aggravated Punishment Act. Kim, who was previously summoned for questioning as a suspect on Jan. 13, is suspected of accepting two 200 million won (US$188,900) payments from former NIS directors Kim Sung-ho, 68, and Won Sei-hoon, 67, while working at the Blue House between Feb. 2008 and Dec. 2011.

Prosecutors also requested a warrant to arrest Kim Jin-mo on charges of embezzlement and bribery according to the Aggravated Punishment Act for allegedly accepting 50 million won (US$47,200) from the NIS. Kim, who performed dispatch work at the Blue House between 2009 and 2011, is suspected by prosecutors of using the money to provide “hush funds” to Jang Jin-su, a former officer in the Office of the Prime Minister’s public ethics support office who blew the whistle on surveillance of civilians during the Lee administration.

On Jan. 12, prosecutors summoned and questioned Kim Jin-mo and Kim Hee-joong, a 50-year-old former Blue House personal presidential secretary suspected of accepting tens of millions of won (tens of thousands of dollars) from the NIS. Closed-door questioning was conducted the same day for former NIS directors Kim Sung-ho and Won Sei-hoon, who were named as responsible for providing the money. Under questioning, the four reportedly acknowledged the truth of some of the accusations presented against them by prosecutors.

Prosecutors also confirmed on Jan. 14 to have repeatedly conducted closed-door questioning of former NIS planning and coordination office directors Kim Ju-seong, 71, and Mok Yeong-man, 59, who administered the NIS special activity funds delivered to the Blue House during Lee’s administration. Both are grouped among Lee’s closest associates during his administration.

The questioning of prominent figures implicated in the illegal diversion of NIS special activity funds concluded three days after the search and seizure operations. If Kim Baek-joon and Kim Jin-mo are taken into custody following their warrant requests on Jan. 14, the investigation is expected to make faster strides toward the top of the line.

The prosecutors are viewing the case as similar to the NIS special activity fund diversions made during the Park administration. As a result, attention is turning to whether Lee himself will be the investigation’s final target. With Won and many other key figures counted among the “MB men” boasting longstanding relationships with Lee, many are strongly alleging that Lee may have ordered the diversions – or at the very least offered condoned or abetted them. Lending weight to this possibility, a source with prosecutors said the structures of the Lee and Park cases “can be viewed as basically similar.”

Indeed, the charges listed against Kim Baek-joon on Jan. 14 were identical to those leveled against the members of Park’s “doorknob triumvirate,” including former Blue House general affairs secretary Lee Jae-man, 52, who is accused of passing NIS funds to Park.

“From the way the investigation is progressing, it looks there was quite a bit of preparation beforehand,” said one attorney and former chief prosecutor.

“Once the flow of the funds has been ascertained, the claims of a few people are not likely to change the situation,” the attorney predicted.

With the investigation entering full swing, the prosecutors are expected to focus their investigative efforts on the possibility that Lee issued orders for delivering the NIS payments to the Blue House. Observers in and around the prosecutors are focusing particular on what Kim Baek-joon – Lee’s upperclassman at Korea University by one year and a close associate for over three decades who served as Lee’s “steward” – will have to say.

On the afternoon of Jan. 13, Kim appeared before prosecutors for 11 hours of intensive questioning, during which he reportedly denied all charges. The prosecutors’ hurried attempt to request an arrest warrant appeared motivated by the likelihood of Kim denying the accusations and attempting to coordinate stories with other parties implicated in the case.

Observers predict the success of the investigation will hinge on whether the prosecutors can acquire enough statements from additional figures and evidence to prove the charges without relying on Kim’s testimony. Lee’s sensitive response to the situation – including emergency meetings with his advisers – suggest the prosecutors face far more hurdles to clear than when investigating the Park administration’s special activity fund payments.

By Kim Yang-jin and Seo Young-ji, staff reporters

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