DP insiders miffed with failure to take Kim Nam-kuk to task

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DP insiders miffed with failure to take Kim Nam-kuk to task

Published: 16 May. 2023, 16:17 Updated: 16 May. 2023, 16:51

Rep. Kim Nam-kuk walks into his office at the National Assembly on Sunday. The lawmaker left the Democratic Party the same day. [YONHAP]

Disquiet within the liberal Democratic Party (DP) over Rep. Kim Nam-kuk's massive cryptocurrency transactions appeared to rise after a DP statement on the matter omitted any mention of referring the lawmaker to a parliamentary ethics committee.

Kim left the party on Sunday amid controversy over his ownership of 6 billion won ($4.4 million) worth of Wemix cryptocurrency tokens that were issued by the game publisher Wemade.

Suspicions surrounding Kim’s crypto investments include the provenance of the money he used to buy the cryptocurrency and whether he used insider information to time his purchase and sale of Wemix tokens.

Kim bought most of his Wemix in January and February last year and sold it all off a month later, just days before Korea adopted a so-called “travel rule” that requires cryptocurrency platforms to retain and share information with financial regulators about the senders and recipients of cryptocurrency transfers exceeding 1 million won in value.

Wemix was delisted in December from all four cryptocurrency exchanges in Korea, including the market leader Upbit, for problematic distribution of issued tokens and false information.

Trading of the cryptocurrency resumed two months later, but its value plummeted, with many investors reporting massive losses.

Prosecutors on Monday raided the offices of Upbit and Bithumb, the country’s two largest cryptocurrency exchanges, in connection with their investigation into Kim’s controversial dealings.

Condemnation of Kim’s crypto dealings within the DP has been particularly strong from members of the faction not aligned with party leader Lee Jae-myung, who himself is under indictment on charges of corruption, breach of trust and bribery for his alleged role in two development projects that launched during his tenure as mayor of Seongnam, Gyeonggi, among other issues.

Kim was a member of the DP faction that has continued to support Lee’s party leadership despite the DP chairman’s embroilment in the ongoing controversies.

The DP held a general meeting of all its sitting lawmakers on Sunday afternoon to address recent controversies that have swept the party, including allegations that aides to former DP leader Song Young-gil distributed envelopes of cash to lawmakers and party members to garner support for his successful party leadership bid ahead of the DP national convention in May 2021.

Proposals in the post-meeting statement included a promise to investigate and potentially penalize Kim for his crypto holdings and transactions, strengthening enforcement of the party ethics code, passing a National Assembly bill requiring the disclosure of lawmakers’ virtual assets, and increasing the transparency of the party’s future national conventions.

But the statement did not include a decision to refer Kim to the National Assembly’s Special Ethics Committee.

Party spokesman Kwon Chil-seung denied that Kim’s referral to the ethics committee was left out due to disapproval from Lee, but at least one DP lawmaker was unimpressed with the omission.

“His referral to the committee should have been at the top of the statement, but it wasn’t there,” said Rep. Park Yong-jin in an interview with CBS Radio on Monday, adding that “several DP lawmakers were deeply displeased and demanded an explanation from the floor leader in the all-member group chat.”

BY MICHAEL LEE [lee.junhyuk@joongang.co.kr]