hankyoreh

Kim Man-bae, the majority shareholder in asset management company Hwacheon Daeyu, arrives at Seoul Central District Court for questioning on Feb. 17, 2023. (Shin So-young/The Hankyoreh)

Controversy is quickly mounting over an article published three days ahead of the Korean presidential election in March 2022, in which it was alleged that then-candidate Yoon Suk-yeol had buried an investigation over Busan Savings Bank loans related to a real estate development project in Seongnam’s Daejang neighborhood.

Prosecutors are investigating allegations that one of the figures involved in the story, Shin Hak-lim, a former National Union of Media Workers president and Newstapa expert advisor, received several hundreds of millions of won worth of money or gifts from Kim Man-bae, the majority shareholder of Daejang scandal-linked asset management company Hwacheon Daeyu, to publish false claims. They also announced plans to look into the possibility of politicians or others having been “behind” the report.

Prosecutors notified Shin that he was to appear for questioning on Wednesday.

Shin insisted that he had “no way of determining at the time whether it was a false interview” and that the “funds received from Mr. Kim [Man-bae] were for writing a book.”

Even if the report is shown to be false, however, it does not automatically dismiss allegations that Yoon carried out a faulty investigation of the Busan Savings Bank situation while still working as a prosecutor.

The situation in question dates back to September 2021, the year before the election. At that point, the allegations in connection with the Daejang project were directed at Lee Jae-myung, who was running for the Democratic Party’s nomination at the time.

In early October of that year, news outlets began reporting that as the main prosecutor for the Busan Savings Bank investigation in 2011, Yoon failed to properly investigate allegations made by Cho Woo-hyeong, the de facto owner of the Hwacheon Daeyu subsidiary Cheonhwa Dongin No. 6. Allegations that Yoon was responsible for effectively burying the claims began gaining traction.

On Feb. 21, 2022 — less than a month before the election — the JTBC network reported that Yoon had “made coffee for Cho” at the time, citing a statement made to prosecutors by attorney Nam Wook. Three days ahead of the election, Newstapa backed up the allegation, releasing a recording from an interview with Kim and Shin on Sept. 15, 2021.

Prosecutors are viewing the claim about Yoon making or having someone else make coffee and about him burying the investigation of Cho in connection with the Daejang allegations as having been false reporting. According to their explanation, Cho was not questioned at the time in connection with illegal loans related to the Daejang project, nor did he ever meet personally with Yoon.

“The fact that the claims in the report were false, combined with the discovery of financial payments, was what led us to begin the investigation,” an official with the prosecution service said.

Some observers have countered this position by arguing that it was “unlikely” for Kim to have given false interview responses ahead of time in anticipation of a situation that would arise six months later.

Newstapa, which published an apology on Tuesday, argued that the prosecutors were “using the financial transaction between the two as a basis for insisting that the report in question was a case of ‘deliberate election interference.’”

But even if the Newstapa report was written in return for a financial payment, the allegations concerning Yoon’s investigation of the case as a prosecutor remain.

Cho fraudulently received around 1 billion won in exchange for loans related to the Daejang project but was only questioned as a “witness” at the time of the 2011 investigation by the Supreme Prosecutors’ Office central investigation division.

He was eventually arrested and indicted in a 2015 investigation by the Suwon District Prosecutors’ Office into corruption associated with the Daejang project. He received a final prison sentence of two years and six months.

“The main content of the report in question [apart from the determination of whether the investigation was faulty] was false,” an official with the Seoul Central District Prosecutors’ Office told the Hankyoreh on Tuesday.

By Lee Jae-ho, staff reporter; Jeon Gwang-joon, staff reporter

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