Tendrils Reach Further in Lee Case

Lee Hyung-taek, managing executive director of the Korea Deposit Management Corp., said Thursday that he met Lee Yong-ho, the central figure in a growing financial scandal involving high officials, for the first time in July 2000, and that he introduced a treasure hunting project to him.

Lee Yong-ho, chairman of the G&G Group, reportedly used the project － a proposed salvage of a sunken ship － to steer the share price of Samae Indus, one of his companies. Earlier in the day at a parliamentary hearing, Lee Hyung-taek had flatly denied knowing Lee Yong-ho.

Mr. Lee said he was first introduced to Lee Yong-ho through Huh Ok-seok who has been detained on charges that he lobbied police officials on behalf of Lee Yong-ho. According to Mr. Lee, Mr. Huh had been asking him to introduce a "rich man" for the treasure-hunting project for a year and a half, and he introduced him to Lee Yong-ho for the "good of the country."

But Mr. Lee denied ever taking illegal wealth, such as by receiving corporate bonds issued by Samae Indus. He also denied lobbying politicians and government officials on behalf of Lee Yong-ho after he was detained and said he had not introduced Lee Yong-ho to Lee Soo-dong, an official at the Kim Dae-jung Peace Foundation.

Lee Hyung-taek is the nephew of the first lady, Lee Hee-ho. An audit into the National Police Agency reported Thursday that since April Seoul's Yeongdeungpo police precinct had been investigating rumors that some persons were accusing Lee Yong-ho of share-price manipulation. The investigation began at the request of Huh Nam-seok, the elder brother of Huh Ok-seok, Lee Yong-ho's lobbyist. The younger Huh attempted to bribe police officials at the time, the auditors said.

Huh Nam-seok has since disappeared and did not appear before the hearing at the National Assembly Thursday.

The National Police Agency has maintained that it began its own investigation into the rumors after a complaint was filed against Lee Yong-ho in May.

According to the agency, Huh Nam-seok bought 80 million won worth of Samae Indus shares through his brother Huh Ok-seok. Mr. Huh has maintained that he never received bribes through his brother in connection with Lee Yong-ho and his corporate restructuring company, G&G.

by Lee Soo-ho