[Editorial] Clear suspicions over former underwear boss

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[Editorial] Clear suspicions over former underwear boss

Kim Seong-tae, former chairman and de facto owner of SBW Group — accused of violating the Capital Market Act, illegal funding to North Korea, and paying legal fees for Democratic Party (DP) Chair Lee Jae-myung when he was Seongnam mayor — has returned home, eight months after he had fled the country ahead of a prosecutorial raid in May last year. He was investigated at the Suwon District Prosecutors’ Office.

SBW Group and its affiliates face multiple criminal charges. Lee Hwa-young — a deputy governor on peace mission under Lee when he was the governor for Gyeonggi — was arrested in October for receiving grafts and corporate card from SBW in return for arranging contacts with North Korea. The company has been accused of sending employees from 2018 to 2019 to China to smuggle $6.4 million to hand over the money to North Korean officials in the country. Ahn Bu-soo, chairman of the Asia-Pacific Exchange Association who played the role of middleman, was also arrested in November for violating the Foreign Exchange Management Act.

The allegation that convertible bonds of SBW were used to pay legal expenses on behalf of Lee had not been verified yet. But a figure from Lee’s legal defense team and camp had worked as an outside director for an SBW company. A former secretary to former DP chair Lee Hae-chan also has been confirmed to be working as an outside director of an affiliate of SBW.

Kim has built wealth through shark loan business and acquired SBW in 2010. He expanded the group through debt and used its assets and stocks to pay off his debt. He went on to acquire other companies through such means. How he was able to expand the business in such an abnormal manner and whether there had been any illicit activities must be investigated.

The Seoul Central Prosecutors’ Office investigating corruption related to suspicious real estate projects under Lee’s term as mayor of Seongnam has asked Lee to return to the prosecution for further questioning after Lunar New Year’s holiday. Lee was already investigated at the Seongnam branch of the Suwon District Prosecutors’ Office on bribery allegations. It is humiliating for the head of the majority opposition party to come under multiple criminal investigations.

The DP has opened an ad hoc National Assembly session without any activity to raise suspicion about using the legislature to defend its chief. (When the National Assembly is in session, lawmakers cannot be arrested.) As the irregularities Lee is being questioned over are related to his days as the Seongnam mayor, the DP must not deal with it as a party issue. Lee must comply with questioning proudly if he has done no wrong as he insists.
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