The Korea Herald


Corruption probes target Roh allies


Published : April 4, 2010 - 01:28

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State prosecutors are zeroing in on former President Roh Moo-hyun`s political allies suspected of involvement in corruption, tax evasion and illegal political funding.
His elder brother Roh Gun-pyeong was arrested Thursday on charges of taking bribes to influence a high-profile corporate takeover in 2006.
Prosecutors probing Roh`s case are shifting their focus to the former president`s confidant and sponsor, Park Yeon-cha, and his political connections.
The businessman is suspected of engaging in an insider trading, tax evasion and illegal lobbying, all related to the elder Roh.
Park runs a fast growing business empire involved in shoemaking, construction, electricity, golf, and finance. His company, Taekwang Industry, is a local production partner of Nike, a global shoe, clothing and sports equipment brand.
A number of politicians and former officials are believed to have collaborated with him in illegal stock trading or received donations from him, some of which may be illegal, prosecution officials said.
Park was fined five years ago for illegal political donations to the former president`s key aide Ahn Hee-jeong.
Prosecutors are planning to summon him next week.
Prosecutors are looking into allegations that Lee Kang-cheol, who served as a political aide to Roh, received 200 million won ($135,000) in illegal political contributions from a businessman.
Lee has banned from leaving the country pending the inquiry.
Separately, a secretary of Lee was arrested last month for taking 50 million from a former chief executive of mobile phone company KTF.
Prosecutors have yet to confirm the money was delivered to Lee.
Another Roh ally, Lee Sang-ho, is also undergoing an inquiry for tax evasion and slush fund creation.
The National Tax Service has asked the prosecution to investigate his medical foundation, called Wooridl, on charges of dodging taxes worth about 1 billion won.
His wife`s pharmaceutical company is also under a tax evasion probe.
The former president refused to apologize over the scandal involving his brother and associates.
"I can`t apologize at a time when my brother is still denying the charges," he told reporters yesterday breaking his weeks of silence.
The incidents were a setback to Roh, who trumpeted anticorruption one of his primary achievements.
The ruling Grand National Party condemned what it called "the hotbed of corruption," as Roh`s brother was detained late Thursday. The opposition Democratic Party expressed regret.
Roh Gun-pyeong and two collaborators were accused of receiving 3 billion won from the former largest shareholder of now-defunct Sejong Securities Co. in exchange for lobbying the National Agricultural Cooperative Federation to take over the distressed brokerage house in 2006. Sejong was renamed NH Investment & Securities.
Park is suspected of having used insider information to trade Sejong stocks.
Prosecutors said yesterday they suspect he may have reaped capital gains worth more than 20 billion won before Sejong was sold to the NACF.
Prosecutors found more than 10 stock trading accounts that Park may have established under borrowed names to deal in Sejong shares and evade taxes.
Prosecutors are also investigating allegations that the elder Roh may have played a role in helping Park take over HUCHEMS, a chemical product maker, from the NACF at a below-market price.
By Hwang Jang-jin