hankyoreh

First lady Kim Keon-hee takes in art at the Kunsthaus Zürich in Switzerland on Jan. 19. (Yonhap)

New developments in the Deutsch Motors stock price manipulation case reveal that accounts belonging to first lady Kim Keon-hee and her mother Choi Eun-soon were used to manipulate market prices during a time period in which the statute of limitations is still in effect.

On Monday, a court ruled that suspicious transactions made from the accounts of Kim and Choi were made after Oct. 20, 2010, which was during the second stage of the stock price manipulation process. These transactions are suspected of violating the Capital Markets Act, according to the court’s ruling.

Judge Cho Byeong-gu of the 23rd criminal division of the Seoul Central District Court determined that transactions made through the first lady’s account during this second stage of stock price manipulation, the statute of limitations of which remains in effect, amount to an act of market price manipulation.

The court also revealed that “the account under Choi Eun-soon’s name was used under a borrowed name by Kwon Oh-soo.”

According to the ruling, at least two of Kim Keon-hee’s five accounts, one of which has an expired statute of limitations, used to commit the crimes were managed by Kwon or asset manager Black Pearl Invest — which played the role of a "control tower" in manipulating stock prices — and were used for market price control, matched orders and wash sales.

It was also revealed that one of Choi’s accounts was used for matched orders and wash sales as well.

In a previous trial, the court cited a large number of orders pouring out from the first lady’s account after contact between a "known stock price manipulator" surnamed Kim and a Black Pearl executive surnamed Min during the second stage of the incident as the basis for its ruling of matched orders and wash sales.

However, the court did not rule whether the first lady was directly involved in the transactions, saying they could “not confirm who placed the orders directly from the account.”

The first trial’s ruling also contradicts President Yoon Suk-yeol’s own explanation of what happened.

During his campaign for president, Yoon’s camp argued that Kim Keon-hee had entrusted the management of her accounts to Lee for four months in 2010 but withdrew the money and severed ties with him after she suffered losses.

According to Yoon’s camp, the period of stock price manipulation occurred in 2011 and 2012 and no stock trading took place during that time.

However, Monday’s court ruling has now confirmed that order matching and wash sales did indeed take place through the first lady’s accounts even after the second stage of the price manipulation process.

Kwon, who orchestrated the pump and dump scheme, was previously sentenced to two years in prison, suspended for three years, and a fine of 300 million won (US$237,700) at the first trial. The person surnamed Kim, who was a party to the market manipulation during the second stage, was sentenced to two years in prison, suspended for three years, and handed a fine of 200 million won.

Regarding these recent developments, the presidential office responded by saying that this information was already public from the investigation stage and had already been reported on numerous occasions by the media, so these facts are “not new at all.”

Instead, the presidential office said the case “could not be prosecuted even after two years of investigations under Justice Ministers Choo Mi-ae and Park Beom-kye because there was no truth to [allegations regarding] involvement in stock price manipulation.”

By Jeong Hye-min, staff reporter

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