Truth can never be concealedLime Asset Management and Optimus Asset Management, which have been accused of financial fraud, tried to lobby officials at the presidential office and ruling party. But the prosecution has not pressed ahead with an investigation. In Thursday’s court hearing, Kim Bong-hyun, founder and former chairman of Star Mobility — Korea’s largest hedge fund Lime Asset — testified he handed over a shopping bag with 50 million won ($44,000) in cash to Lee Kang-se, CEO of Lime Asset after Lee claimed he was meeting Kang Ki-jung, then senior presidential secretary for political affairs.
Kim had recruited Lee for political lobbying. Kim said he has made the same testimony to the prosecution since April. The prosecution also secured CCTV from a hotel where Kim handed over a shopping bag to Lee. But prosecutors did not press on with the investigation after Lee denied it.
Lee might have embezzled the money, since Kang insisted he had never received it. But the prosecution did not even investigate the possibility of Lee’s embezzlement. The Seoul Southern District Prosecutors’ Office indicted Lee, but did not report it to the higher level. Prosecutor General Yoon Seok-youl is said to have learned of it from media reports. The prosecution likely kept silent on the affair in fear of receiving an order from the prosecutor general to explore further into the investigation.
The prosecution received files of Optimus lobbying to government officials and politicians in June. The 20 names included five from the Blue House. The Seoul Central Prosecutors’ Office also did not press on with the investigation or report it to a higher level. It also left out the fund managers’ testimonies that they had lobbied officials at the Financial Supervisory Service. The prosecution might have tried to cover up the case.
As many as 4,000 customers lost over 1 trillion won in the Lime fraud. Over 1,000 subscribers lost 500 billion won in the Optimus scandal. It is a serious crime to interfere or stop the investigation after receiving money from scammers. But prosecutors who were on the case were removed and replaced with those who would act in favor of the government. Is that part of the prosecutorial reforms being pushed by the government?
Truth can never be concealed. Wrongdoings are uncovered later through reinvestigations or special probes. To avoid greater shame later, the prosecution must be thorough with investigations. Those who had neglected their jobs must also be investigated and held accountable.