British school in Seoul raided in a tax probe

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British school in Seoul raided in a tax probe

Prosecutors are cracking down on allegations of corruption that include embezzlement at international schools in Korea, according to officials, and conducted a search and seizure of Dulwich College Seoul at the beginning of this week.

The Seoul Central District Prosecutors’ Office conducted a search of the administration office and other locations of the British school Dulwich College in Seocho District, southern Seoul, on Monday, officials said on Wednesday.

A group of 10 officials, including three prosecutors, confiscated account books and other school records amid suspicions that Dulwich had used shell companies to siphon some of its revenues from tuition payments overseas.

Prosecutors plan to investigate if the school officials are transferring school funds overseas for tax evasion.

The search and seizure took place after 4 p.m. to prevent disruption of classes.

The London-based Dulwich opened its Seoul campus in 2010. Its average annual tuition was over 28 million won ($24,000) last year, according to data acquired by the office of ruling Saenuri Party Rep. Han Sun-kyo.

Including other school-related fees such as for buses and lunch, the total cost can amount to over 30 million won per year.

There are over 590 students enrolled in the school, which runs from kindergarten through high school. A quarter of the students, or 25.5 percent, are Korean citizens.

Since the beginning of the year, the prosecution has launched investigations into the management of foreign schools.

This follows Incheon prosecutors’ probe in 2012 of nine international schools for admissions fraud.

The schools were accused of illegally admitting children of chaebol families or ranking government officials and accepting fabricated immigration and admissions documents for enrollment.

Brokers received from 40 million to 150 million won from 47 parents of students enrolled in the foreign schools in Korea to fabricate citizenship for their children from South American or African countries, including Guatemala, Brazil and Honduras, according to the prosecutors’ investigation.

Prosecutors found that Dulwich admitted 16 students on such falsified documents. Parents involved were fined up to 15 million won.

According to Korea’s enforcement decree on the establishment and management of foreign schools and foreign kindergartens, foreigners or Koreans who have resided in a foreign country for over three years can be enrolled in foreign schools.

This presidential decree further stipulates that “domestic persons… shall not comprise more than 30 percent of the student body of foreign schools,” but that the superintendent of the Office of Education “may raise the ratio of domestic students that may be admitted to foreign schools within the scope of 20 percent according to the educational regulations.”

There are 47 foreign schools nationwide charging tuition of between 15 million and 30 million won. In comparison, regular high schools have yearly tuition averaging 2.4 million won.

Tuition at the more costly autonomous private high schools are around 5 million won.

“The current step, as the beginning of the investigation, will focus on allegations about the management of the school,” a prosecutor said.

BY LEE YU-JEONG, SARAH KIM [kim.sarah@joongang.co.kr]

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