[EDITORIALS]Scandals take a new turn

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[EDITORIALS]Scandals take a new turn

The independent counsel team has belatedly found that Lee Hyung-taek, nephew of the first lady Lee Hee-ho, had arranged to receive 15 percent of the profits from a treasure hunting project undertaken by Lee Yong-ho, a central figure in a financial fraud case. This is the first time a member of President Kim Dae-jung's family has been implicated in one of the financial fraud cases plaguing the nation, and it introduces a new phase in the ongoing investigation of corruption cases.

The independent counsel team found that the former managing executive director of the Korea Deposit Management Corp., along with two others, drew up an agreement in November 2000 that promised him a high percentage of profits if the treasure hunting project succeeded. The agreement was approved by a notary public. Lee Hyung-taek then invited Lee Yong-ho, president of the G&G Group, to invest in salvaging a sunken treasure ship in the seas off Jindo, South Jeolla province. Lee Yong-ho used the project to steer the share price of Samae Industries, one of his companies, and earned nearly 26 billion won ($20 million) through stock manipulations. The independent counsel team believes that Lee Hyung-taek took the initiative in the treasure hunting project, invited Lee Yong-ho to invest and then induced the involvement of officials of the National Intelligence Service with his influence.

Lee Hyung-taek had come under public scrutiny before. When suspicions of a slush fund for then-presidential candidate Kim Dae-jung broke out prior to the 1997 presidential election, Lee Hyung-taek was said to be one of the central managers of the presidential candidate's political funds. During last fall's parliamentary inspection, the former managing executive director of the Korea Deposit Management Corp. denied his involvement in Lee Yong-ho-gate, and said, "I am innocent, and I have no regrets or qualms about what I did."

If the independent counsel's allegations are found to be true, the Kim Dae-jung administration will be dealt another moral blow. President Kim has called for a reform against corruption ever since he took office in February 1998, but if the implication of his wife's nephew is added to the recent discovery that former presidential secretaries were involved in the scandal cases, Mr. Kim will surely be at a loss for words.
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