Close confidant of DP chief arrested over illegal political funds

Politics

Published: 23 Oct. 2022, 17:35

Close confidant of DP chief arrested over illegal political funds

Lee Jae-myung, left, chairman of the Democratic Party (DP) Chairman and a former Gyeonggi governor, and Kim Yong, then a Gyeonggi provincial government spokesman, in a photo from December 2019 shared on Kim’s blog. [SCREEN CAPTURE]

A close confidant of Democratic Party (DP) chief Lee Jae-myung was arrested by prosecutors Saturday over allegedly receiving illegal political funds related to a corruption scandal.

The Seoul Central District Court issued an arrest warrant for Kim Yong, deputy head of the DP-affiliated think tank Institute for Democracy, earlier Saturday for allegedly receiving a total of 847 million won ($593,552) in violation of the Political Funds Act from real estate developers in the Daejang-dong land development project in Seongnam, Gyeonggi.

The court said there is the risk he may destroy evidence related to the case.

Kim is accused of colluding with stakeholders and received the funds in cash on four occasions between April and August in 2021, ahead of the DP's primary election.

Prosecutors believe the funds were used in Lee's presidential campaign. Kim was in charge of fundraising on the primary election campaign for Lee. Lee ultimately lost by a narrow margin in the March 9 presidential election to his People Power Party (PPP) rival Yoon Suk-yeol.

The Daejang-dong land development scandal centers on allegations that an obscure and small private asset management company, Hwacheon Daeyu, and its affiliates reaped exponential profits from the 2015 project, which was during Lee's time as Seongnam's mayor.

Kim is said to have colluded with figures who benefited from the Daejang-dong project and the Wirye urban development project straddling eastern Seoul and Gyeonggi, including former acting president of Seongnam Development Corporation Yoo Dong-gyu and lawyers Nam Wook and Jeong Min-yong, who at the time was head of the Seongnam Development Corporation's strategic project office.

Prosecutors said that Yoo testified that Kim requested some two billion won from him in February 2021 to be used for Lee's campaign and that he had relayed the money.

Yoo was arrested and indicted last year for his alleged involvement in the land development scandal and released from jail last Thursday due to a legal expiration of the detainment period. The DP raised its suspicions that Yoo made a deal with the prosecution to secure his release.

Last Wednesday, prosecutors detained Kim for violating the Political Fund Act and tried to raid the Institute for Democracy's offices in the DP headquarters in Yeouido, western Seoul, but lawmakers blocked them from entering.

As Kim has been described as one of Lee's closest confidants, his arrest is seen as an indication of the probe narrowing in on the DP chairman.

Lee in a press conference at the National Assembly Friday called for an independent counsel probe into the land development scandal.

Lee said he "officially requested" that President Yoon and the PPP call for an independent counsel investigation into the Daejang-dong land development allegations.

He denied that the bribes allegedly received by Kim were used for his presidential campaign.

"I have not received a single piece of candy, let alone illegal presidential funds," added Lee.

The PPP immediately rejected Lee's request.

"Since the [prosecution] investigation is proceeding properly, Lee is requesting a special probe so that an independent counsel can take over the investigation and drag out the process," PPP floor leader Joo Ho-young said in a press conference Friday.

"The only way to get rid of political conflict and focus on people's livelihoods is for the prosecution to quickly and strictly investigate and report the results to the public."

The DP holds a parliamentary majority with 169 seats, meaning it can pass a bill to conduct a special counsel probe without PPP support. The president has the power to veto it.

In a press conference Sunday at the National Assembly, Cho Jeong-sik, the DP's secretary-general, called on the Yoon government to give an answer on a special probe by Tuesday, ahead of the president's budget speech at the National Assembly.

"If President Yoon Suk-yeol and the PPP have nothing to be ashamed of, the special probe should be accepted immediately," said Cho.

The Seoul Central District Prosecutors' Office summoned Kim, who is detained at the Seoul Detention Center, for questioning on Sunday.

BY SARAH KIM [kim.sarah@joongang.co.kr]