Finance Ministry raided in Ulsan mayor case

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Finance Ministry raided in Ulsan mayor case

Prosecutors raided the Ministry of Economy and Finance in Sejong Friday as part of a probe into allegations that the Blue House meddled in the June 2018 Ulsan mayoral election to help the candidate from the ruling Democratic Party (DP) win.

The Korea Development Institute, a state-backed think tank based in Sejong, was raided the same day.

The Seoul Central District Prosecutors’ Office sent a team of prosecutors and investigators to both organizations to confiscate documents and computer hard drives related to the government’s preliminary feasibility examinations of state projects.

Prosecutors are trying to figure out whether the current Ulsan mayor, Song Cheol-ho, was tipped off by the Blue House and the Ministry of Economy and Finance about a negative report on a hospital project pushed by his opponent in last year’s election - so that Song could promote a different hospital project.

Prosecutors recently raided Ulsan Vice Mayor Song Byung-gi’s office and residence and found a 30-page notebook that described meetings he had with Blue House officials in late 2017 and early 2018. The hospital project was a topic in those rendezvous.

Kim Gi-hyeon, who was Ulsan mayor from July 2014 to June 2018 and a member of the main opposition Liberty Korea Party (LKP), had long vowed to establish a hospital specialized in labor accidents. Ulsan, a coastal city in the southeastern part of the country, is an industrial powerhouse and home to one of the world’s largest automobile assembly plants and shipyards.

But on May 28, 2018, less than a month before the June 13 Ulsan mayoral election in which Kim was seeking a second term, the Ministry of Economy and Finance pulled the plug on the plan to build that hospital.

During the campaign, Kim’s DP opponent, Song Cheol-ho, pushed for a public hospital for general patients. After he became the Ulsan mayor, Song tweaked that vision, saying he’d establish a public hospital specializing in labor accidents.

In January, the Finance Ministry exempted Song’s plan from a preliminary feasibility examination, and work on the hospital began, with completion expected in 2025.

Prosecutors believe the Blue House and the Finance Ministry informed the DP candidate that Kim’s campaign promise would be struck down before the government actually announced it.

In the Ulsan vice mayor’s notebook, it read that the vice mayor met a Blue House official in October 2017 and talked about “shelving” Kim’s labor hospital plan and “the necessity to quickly review the idea of establishing a public hospital.”

During another meeting in March 2018 with the Blue House’s secretary for social policy, the vice mayor wrote that total expenses for constructing a public hospital would be 200 billion won ($172.3 million), and that “in case the Finance Ministry opposes” the budget, “there’s a need to prepare ways to alleviate costs paid by Ulsan.”

The LKP, which accuses the Blue House of meddling in last year’s Ulsan election, is expected to hold a protest in Ulsan today. The DP, on the other hand, denounced prosecutors for carrying out what they claimed to be an unfair probe targeting the Moon Jae-in administration, saying if they continue to be biased, the party would introduce a bill calling for an independent counsel probe into the alleged election-meddling case.

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