Roh’s in-law arrested in widening bribery probe
Yeon Cheol-ho, 36, was arrested by prosecutors yesterday morning at his home in Bundang, Gyeonggi, on charges of violating the nation’s law governing foreign currency transactions. [YONHAP]
Yeon Cheol-ho, 36, was taken into custody on charges of violating the nation’s law governing foreign currency transactions. Yeon is the husband of Roh’s elder brother’s daughter. Yeon received $5 million from Park, chairman of Busan-based Taekwang Industrial, on Feb. 22 last year, days before Roh’s presidential term ended. The money was wired from a bank account in Hong Kong. Yeon said the money was a legitimate business investment.
But prosecutors said that Yeon failed to report the transaction to the financial authorities. A Korean resident is required to file a report about foreign currency dealings of such magnitude. Yeon is also required to report on how he spent the money, prosecutors said.
The prosecution obtained a warrant and arrested Yeon at his home in Bundang, Gyeonggi, yesterday morning.
Prosecutors suspect that Park raised about $68 million in secret funds through his company’s Hong Kong affiliate, APC. Of the money, $5 million was sent to Yeon’s investment startup, established in the British Virgin Islands, a tax haven for thousands of offshore companies.
Prosecutors said they are questioning Yeon about the $5 million, after testimony from a key Roh patron raised suspicions that the money was not a legitimate investment.
Kang Geum-won, head of Changshin Textile and an influential fund raiser for Roh, told the Daejeon District Prosecutors’ Office that he, Park and Chung Sang-moon, who served as Roh’s presidential secretary at the time, held a meeting in August 2007 to discuss what Roh would do after his term ended. At that meeting, Park said he had secret funds in Hong Kong and promised to provide $5 million.
Kang has been arrested on charges of tax evasion and embezzlement, and Chung is suspected of receiving bribes from Park.
While prosecutors are trying to find out the real nature of the $5 million, the former president has said he was aware of the deal, but he regarded it as a legitimate business investment. In a statement issued on Tuesday, Roh wrote, “After my presidential term ended, I learned that my niece’s husband received money from Park, but I did not take any special action. Although it appears that Park was unusually generous, the money was an investment, and it happened after my term ended.”
While Roh denied any tie with the investment, a senior prosecution source told the JoongAng Ilbo Thursday that Roh’s son, Gun-ho, is thought to be involved. “We learned that Roh Gun-ho is a major shareholder in Yeon’s investment startup,” the official told the JoongAng Ilbo.
The source said the Supreme Public Prosecutors’ Office obtained a document proving the link between the former president’s son and Yeon’s firm. According to the source, investigators obtained a memo written by a Taekwang executive during a raid on the shoemaker and its affiliates. The memo stated that Roh Gun-ho was a major shareholder in Yeon’s investment firm, the official said.
Prosecutors also obtained testimony from a Taekwang executive in charge of Park’s money dealings that claimed a significant part of the $5 million that went from Park to Yeon was actually earmarked for Roh Gun-ho. Prosecutors are considering summoning the son, who is currently thought to be in the U.S., before they interview the former presidential couple, sources said.
Roh Gun-ho said he traveled to Vietnam in February 2008, around the time Roh’s term ended, and met with Park to learn about how to succeed in overseas business. Yeon accompanied him, Roh Gun-ho said.
Shortly after their visit, Park provided the $5 million.
Meanwhile, Chung, Roh’s key aide suspected of delivering $1 million to the former president, was released from prosecution custody early yesterday morning. Chung was initially arrested on charges of receiving 300 million won in cash and 100 million won in gift certificates from Park.
The prosecutors sought a warrant to further detain Chung to investigate whether he delivered a bribe to Roh and his own bribe-receiving from Park, but the Seoul Central District Court denied the prosecution’s request.
Chung is suspected of receiving $1 million from Park in June 2007 at the Blue House while Roh was still president. Chung admitted delivering the suitcase filled with $1 million to Kwon Yang-sook, then the first lady, not to Roh.
At the warrant hearing, Chung also admitted to receiving 300 million won from Park and delivering it to Kwon. He argued that he never received the 100 million won worth of gift certificates.
Judge Kim Hyeong-du of the Seoul Central District Court said detaining Chung based on what prosecutors have found so far may inappropriately restrict the suspect’s right to a defense.
Hong Man-pyo, senior prosecutor in charge of the case, said, “We will thoroughly review the reason for the rejection and decide whether we will reapply for it or not.” By having applied for a warrant to detain Chung, prosecutors revealed that their investigation is destined to target the former president because Chung was treated as an accomplice to receiving bribes.
While Chung was let go by the prosecution, another Roh aide was accused of receiving bribes from Park. The Supreme Public Prosecutors’ Office said Ahn Hee-jung, a member of the Democratic Party’s Supreme Council, allegedly received 50 million won worth of gift certificates from Park last summer.
Ahn was questioned last week about the charge. “I will not deny it. I told the prosecutors in detail about what had happened,” the Roh aide told Yonhap News Agency in a phone interview. “But the prosecution will decide whether it is a problem or not.”
Meanwhile, a former presidential aide to Lee Myung-bak was indicted yesterday on charges of receiving bribes from Park for his failed attempt to influence a tax probe into Park’s company Taekwang.
According to the prosecution, Choo Boo-kil, former presidential secretary for public affairs for Lee, attempted to halt the tax probe by calling President Lee’s elder brother, Representative Lee Sang-deuk, and Representative Chung Doo-un of the Grand National Party.
Prosecutors said Choo telephoned Representative Lee twice and made the request to halt the tax probe, but Lee rejected the demand. The phone calls were placed between Sept. 17 and Oct. 23 last year, the prosecution said.
Choo also called Chung on Oct. 25 last year, but was turned down again, prosecutors said.
By Ser Myo-ja [myoja@joongang.co.kr]
with the Korea JoongAng Daily
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