QIA denies bidding for Landmark 72

A nephew of UN Secretary General Ban Ki-moon lied when he said the Qatar Investment Authority (QIA) was interested in buying a building in Vietnam owned by Keangnam Enterprises, the company at the center of a major political corruption scandal in Korea.

Ban’s nephew Bahn Joo-hyun claimed to have negotiated the sale of the Keangnam Landmark 72 in Hanoi with the QIA.

But in an email sent to the Korea JoongAng Daily through its public relations agency on Friday, the QIA denied it was interested.

“Qatar Investment Authority has not attempted to buy the Landmark 72 Tower in Hanoi, Vietnam,” the email read. “All reports to the contrary are false and are denied.”

Bahn, managing director of the New York branch of real estate firm Colliers International, has reassured the construction company and its creditors that the deal was ongoing and on the verge of coming through.

Ban Ki-sang, his father and younger brother of the UN secretary general, worked for Keangnam Enterprises as a senior adviser for seven years and is known to have recommended the construction company appoint Colliers International as the exclusive agency for the building’s sale in 2013.

The suspicion is that Bahn and his father intentionally deceived the company and its creditors by pretending to be close to selling the building, so creditors would continue to support Keangnam, which was struggling financially.

Construction of the Landmark 72, Vietnam’s tallest building, was completed in 2011 and cost Keangnam Enterprises about 1.2 trillion won ($1.1 billion). Subsequently, the company was struggling to repay its 530 billion won in debt.

The company decided to be delisted and go under debt receivership in March.

Creditors to Keangnam are known to have eased conditions for its debt workout because Bahn pretended that he was still negotiating with the QIA over the sale of the Landmark 72.

Bahn submitted a document in March to Keangnam Enterprises showing that the QIA was willing to buy the building. That document was submitted to creditors. QIA later denied the validity of the document.

Keangnam Enterprises is in the news because it and its former chairman, Sung Wan-jong, were investigated earlier this year for having fraudulently profited from the so-called resources diplomacy of the previous Lee Myung-bak administration.

An outraged Sung protested his innocence in April shortly before hanging himself on a mountain in Seoul - but not before he claimed publicly to have made payoffs to the inner circle of current President Park Geun-hye. That started the biggest scandal of the Park administration, which is still growing.

Managers of Keangnam Enterprises on Friday asked its court receivers to strip Bahn of his exclusive right to negotiate the sale of Landmark 72, saying, “Bahn did not properly fulfill his duties as he did not answer the company’s inquiries over the process and possibility of the building’s sale.” The Seoul Central District Court accepted the request later on Friday.

Creditors and shareholders of Keangnam aren’t happy with the news of the Landmark 72 ruse.

“We have financially supported Keangnam Enterprises because we trusted that the sale process [of Landmark 72] was going well,” said a creditor. “We will make some of them take legal liability [for our loss].”

BY KIM BONG-MOON [kim.bongmoon@joongang.co.kr]