Optimus scandal warrants new probe

A document obtained by Korean broadcaster SBS shows it all.

The internal document from Optimus Asset Management, a private equity fund accused of massive financial fraud, included a summary of countermeasures its management devised after the Financial Supervisory Service (FSS) started investigating a fund that caused a whopping 500 billion won ($436.1 million) in losses to investors. The document says that several members of the ruling Democratic Party (DP) and government officials had invested in the equity fund, and had gotten involved in designing and operating the fund. The document also includes the names of politicians and senior officials who directly or indirectly helped Optimus.

The prosecution admits that it obtained the document several months ago. And yet prosecutors have not explained where they got the paper and how it was drafted. Despite its obligation to investigate any illegalities at the hedge fund, the prosecution chose to shy away from it. We cannot but question if prosecutors deliberately ignored the document after discovering the names of heavyweight politicians and government officials.

After the document became a hot potato in the National Assembly’s audit of the government, Justice Minister Choo Mi-ae said it could be a document to prepare for an investigation by the FSS. A DP lawmaker relayed to reporters its floor leader’s conclusion that it can hardly be an issue. The chief of the financial watchdog joined the chorus by expressing his judgment that it could be a “fabricated document.”

In a strange development, key members of the government rushed to defend the equity fund even before the prosecution starts looking into the case. That sounds like a tacit warning to the prosecution not to dig too deep. If the justice minister and DP floor leader were forthright, they would call for a thorough investigation of the case.

Now that media reports have confirmed the authenticity of the document, the prosecution must launch a probe immediately. The fraud at the equity fund could not be committed without protection from the powers that be. Many public institutions invested tens of billions of won in the fund, yet the FSS dismissed the case even after finding problems with the way the fund was managed.

Prosecutor General Yoon Seok-youl asked the Justice Ministry to dispatch 10 more prosecutors to an investigation team as reinforcements. If the justice minister refuses the request, she advocates for criminals. We hope the DP accepts the opposition’s proposal of an investigation by a special prosecutor. If the DP is really innocent, why not?