hankyoreh

The entrance of the Seoul Central Prosecutor’s Office in the Seocho district of Seoul. (by Shin So-young

South Korean prosecutors have expanded their investigation after acquiring evidence that not only Samsung but also Hyundai Motor Company provided a large amount of financial support for DAS’s legal fees in the US. The prosecutors also disclosed that the family of former president Lee Myung-bak created a slush fund worth more than 10 billion won (US$9.4 million) separate from the previously reported fund of 12 billion won ($11 million) and have concluded that Lee was the real owner of DAS, the Hankyoreh confirmed on Feb. 18.

Hankyoreh reporters learned that the first high-tech crimes division under Shin Bong-su at the Seoul Central District Prosecutors’ Office is investigating charges that Hyundai gave around US$1 million to Lee by paying DAS’s legal fees in 2009. This is similar to the US$4 million that Samsung wired to a US law firm called Akin Gump to pay DAS’s legal fees. The prosecutors suspect that this money was a bribe given by Hyundai Motor at Lee’s request, just as with Samsung.

On Feb. 15, the prosecutors called former Samsung Group Vice Chairman Lee Hak-soo, 75, in for questioning about suspected bribery in connection with the US$4 million paid for DAS’s legal fees. Lee provided the prosecutors with a written confession stating that the request had come from Lee Myung-bak’s associates and that he had sent the money to Akin Gump at the request of Samsung Chairman Lee Kun-hee, who was hoping to be pardoned.

Hyundai Motor provided the Hankyoreh with the following explanation: “We have made payments to Akin Gump on two occasions because of patent lawsuits that have been continuing since 2009, but these have nothing to do with making payments on DAS’s behalf.”

Separately from this, the team of investigators led by senior prosecutor Mun Chan-seok that has been tracking DAS’s slush fund has concluded that DAS was owned and controlled by Lee Myung-bak and is planning to announce the results of its investigation at the beginning of this week. The prosecutors also announced that Lee Myung-bak’s family had created a slush fund of over 10 billion won, separately from the fund of over 12 billion won that has already been reported.

“The majority of the people who have been called in for questioning so far have testified that Lee Myung-bak is the actual owner of DAS, and this is also consistent with the findings of our investigation,” a source with the prosecutors said.

The prosecutors are also strongly considering the option of not indicting former special prosecutor Chung Ho-young, 70, who stands accused of failing to notify the prosecutors that he had found a slush fund exceeding 12 billion won ($11 million) during a 2008 investigation (corresponding to the crime of special dereliction of duty according to the Act on the Aggravated Punishment of Special Crimes). This reportedly reflects the prosecutors’ conclusion that the 12 billion won slush fund was not created to evade taxes but was the result of personal embezzlement by a DAS bookkeeper surnamed Cho.

By Kang Hee-cheol and Seo Young-ji, staff reporters

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