&#91EDITORIALS&#93Inquiry raises doubts

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[EDITORIALS]Inquiry raises doubts

Watching the prosecution's investigation of SK Corp., there are some questions and concerns about the possible fallout. The prosecution says that it is a routine investigation, but hardly anyone is buying this characterization, and with the investigation expected to widen, the business community fears that the incoming administration has signaled that it will be tough on the jaebeols, or family-owned conglomerates.

The investigation raises many questions on its timing and fairness. More than anything else, it is hard to comprehend why the prosecution, which deferred a formal inquiry into Hyundai Business Group, suddenly opened an investigation into SK Corp.

The charges facing SK Corp. -- stock transactions with JP Morgan, swapping of shares between SK's chairman, Chey Tae-won, and other SK affiliates -- are not new. Thus we cannot but ask why the prosecution bars the head of the No. 3 business group from leaving the country and warns of legal action when the nation's economy is struggling. The late-night blitzrieg raid on the office of the conglomerate's chairman and the fast pace of the investigation is unprecedented to the extent that industry analysts have raised their eyebrows. That is why the investigation is fueling speculation, including suggestions that the prosecution was trying to divert attention from Hyundai's illegal funneling of money to North Korea. Indeed, the investigation into SK Corp. seems bizarre.

In the end, the burning question here concerns timing. The North Korean nuclear issue, the standoff between the United States and Iraq and uncertainty on the policies of the incoming administration have eroded investment sentiment to the point that a state-run bank forecast that it would be very difficult for South Korea to achieve its potential economic growth this year. It is not wise to shake up a business or the business community at these times.

Admittedly, Korean conglomerates carry with them many problems. We cannot overlook illegal business actions just because the economy is sluggish. But the prosecutors should bear in mind that their efforts will bring desirable results only if they are taken at the right time and through due process.
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