In Taekwang scandal, another home raided

Prosecutors investigating Taekwang Group’s alleged slush fund case raided the house of Lee Sun-ah, mother of Taekwang Chairman Lee Ho-jin, in connection with allegations that she is behind the Taekwang’s multibillion won slush fund.

Investigators at Seoul Western District Prosecutors’ Office obtained a search warrant from a local court and stormed into Lee Sun-ah’s house in Jangchung-dong at 11:58 a.m. yesterday. Investigators dispatched to the site were accompanied by two locksmiths to unlock doors and safe boxes inside Lee’s house.

The raid was finally approved by the court after the prosecution’s search warrant requests were rejected for lack of evidence. The home of Taekwang Chairman Lee Ho-jin was raided last Saturday.

Lee Sun-ah, 82, is an executive director of Taekwang Group and sources told the prosecution that though her son, Ho-jin, heads the company, she maintains powerful influence in the company and receives regular briefings about company performance.

After scrutinizing the data confiscated at Lee Sun-ah’s house, the mother and son will be summoned to the prosecution for allegedly raising multibillion won slush fund by opening insurance and bank accounts in other people’s names.

Lee’s son, Ho-jin, 48, is suspected of using the money for bribing officials at the Korea Communications Commission and the Blue House to expand Taekwang’s cable TV business.

Earlier this week, the prosecution summoned close aides of Lee Ho-jin, including Daehan Synthetic Fiber Chairman Park Myeong-seok and Kim Yeong-sik, head of a Busan-based golf practice range.

Both Daehan Synthetic Fiber Co. and the golf range are affiliated with Taekwang Group. Prosecutors believe Park and Kim were key players in helping the Lee family raise the alleged slush funds.

Park Yun-bae - president of Seoul Investment Company, which is a minority shareholder of Taekwang, and also the whistle-blower of Taekwang’s alleged slush fund - told prosecutors that Park Myeong-seok has been closely involved in managing the financial affairs of Taekwang Group.

Park Yun-bae claims “Park Myeong-seok took unregistered bonds from Taekwang Group Executive Director Lee Sun-ah and cashed them.”

Park Yun-bae said Kim Yeong-sik, the golf practice range owner, has looked after the Taekwang Group family fund since Lee Eam-yong, the founder of Taekwang Group, was at the helm of the company.

Both Park Myeong-seok and Kim Yeong-sik were summoned for questioning earlier this week.

“Both Park and Kim have been devoted to the company for more than two decades,” said a prosecutor who asked not to be named. “They are so loyal to Taekwang Group that they wouldn’t give any details about allegations.”

Prosecutors are now mulling over collecting more evidence to prove allegations that Taekwang Chairman Lee Ho-jin allegedly embezzled company money for personal use. They are noting that some bank accounts used for the alleged slush fund had cash withdrawals on different occasions over several years.

Taekwang Group is likely to hire Kim & Chang - Korea’s largest law firm - as its attorney.

According to Taekwang Group and Kim & Chang on Wednesday, Lee Ho-jin has requested Kim & Chang to defend his company.

By Kim Mi-ju, Choe Sun-uk [mijukim@joongang.co.kr]