Underwear tycoon, relative, nabbed on Thai golf course

Social Affairs

Published: 11 Jan. 2023, 17:58 Updated: 12 Jan. 2023, 13:17

Underwear tycoon, relative, nabbed on Thai golf course

Kim Seong-tae, former chairman of SBW Group, right, and Yang Seon-gil, current chairman of SBW Group, at a golf course in Thailand on Tuesday evening shortly after they were arrested by Thai police [JOONGANG ILBO]

The former chairman and de-facto owner of a major underwear company facing corruption charges – including one that involves Democratic Party (DP) Chairman Lee Jae-myung – was arrested in Thailand Tuesday evening.

Korean prosecutors told reporters that 55-year-old Kim Seong-tae, ex-chairman of SBW Group, was nabbed by Thai police at a golf course in Pathum Thani Province, north of Bangkok, at around 5:30 p.m.

At the time of his arrest, Kim was with current SBW Group Chairman Yang Seon-gil. Yang was also arrested on the scene.

Kim and Yang are relatives.

On May 31, 2022, Kim fled Korea as prosecutors were zeroing in on him. He escaped to Singapore and was believed to have gone into hiding somewhere in Southeast Asia.

Interpol issued a red notice for the search and arrest of Kim.

Kim was apprehended on the same day that DP Chairman Lee was grilled by prosecutors over allegations of bribery during his term as mayor of Seongnam, Gyeonggi.

All eyes are now on whether Kim will agree to return to Korea for questioning.

Korean prosecutors told the JoongAng Ilbo Wednesday that Thailand, which signed an extradition treaty with Korea in 2001, has been cooperative. But Kim is legally allowed to refuse extradition and have his case tried in a Thai court.

As of noon on Wednesday, prosecutors said Kim hadn’t refused extradition.

Prosecutors told the JoongAng Ilbo that they had been tracking Kim’s whereabouts in Thailand since a close aide of his at SBW Group, identified by the surname Kim, was arrested by Thai police last month in Pattaya, south of Bangkok.

Prosecutors dug through the aide’s emails, suspected the ex-chairman was hiding in Thailand, and asked Thai police for assistance in finding him while investigating several people who appeared to be aiding the fugitive.

If Kim doesn’t refuse extradition, a prosecutor who spoke with the JoongAng Ilbo on the condition of anonymity Wednesday said that the investigation into Kim and his company’s shady deals is expected to gain momentum.

Kim faces a wide range of allegations. Prosecutors think he used his SBW Group to collude with political circles and send cash and extravagant gifts to North Korea’s leadership, while embezzling company funds to pay off DP Chairman Lee’s legal fees, all to increase his own wealth.

Kim, who stepped down from the SBW chairmanship in May 2021 but allegedly remains in charge of major decision-making at the company, is believed to have paid Lee’s legal fees when Lee was being prosecuted for violating the election law in 2018, when he was governor of Gyeonggi.

Lee was acquitted of that charge by the Supreme Court in 2020.

Lee’s lawyer allegedly received nearly 300 million won ($241,000) from SBW Group during the trial, and an additional 2 billion won in SBW stock that he could sell after three years.

Aside from the allegations involving the DP’s chairman, Kim is under investigation for smuggling company funds out of the country to give to North Korean officials for future business opportunities.

In 2019, SBW Group is believed to have given the North Korean government over $2 million in several transactions to clench an underground resource development project.

SBW executives are also believed to have handed over Rolex watches to North Korean officials and a saddle made by high-end brand Hermès to North Korean leader Kim Jong-un.

Kim Jong-un is known to be an enthusiastic equestrian.

The cost of the saddle is unknown, but if the allegation is true, it would mean the businessman violated UN National Security Resolution 1718, which forbids any export of luxury goods to the North.

Prosecutors think the businessman tried to capitalize on thawing tensions between the two Koreas four years ago under the Moon Jae-in administration.

Kim also faces suspicions that he used 3 billion won worth of SBW Group company funds in 2018 and 2019 to purchase 20 billion won worth of convertible bonds at paper companies believed to be owned by him and his closest aides.

Half of those convertible bonds were later purchased by an SBW Group affiliate, which in December 2019 hired a lawyer who worked on DP Chairman Lee’s election law violation case and served as the head of Lee’s legal team when Lee ran for president in the 2022 race.

Lee has denied any wrongdoing.

Sources in the judiciary told the JoongAng Ilbo late last year that Kim had recently reached out to prosecutors through several undisclosed routes, saying he was willing to return to Korea and show up for questioning in the case involving Lee if prosecutors closed investigations of his other activities at SBW.

Prosecutors refused that offer.

One prosecutor told the paper that Kim, at one point, tried to blackmail them, saying that he colluded with several prosecutors and would reveal their names if they cornered him.

Kim is believed to have worked as a gang member in Jeonju, North Jeolla, and built a fortune by illegally running a private loan business and a gambling site. In 2006, he received a suspended eight-month jail term for running the gambling site, and in 2017, he was fined 15 million won for running a private loan business.

In 2010, Kim established a so-called special purpose company and acquired the underwear maker Ssangbangwool. Through the years, he acquired several other companies in various industries, including a talent agency and a bio-health business to create today’s SBW Group.

An acquaintance of Kim who recently spoke with the JoongAng Ilbo said Kim had big ambitions for SBW and wanted to join the chaebol big league by using his political connections.

BY PARK HYEON-JUN,LEE SUNG-EUN [lee.sungeun@joongang.co.kr]