Tuesday, December 1, 2020

Former chairman of South Korean investment firm caught on tape discussing bribes paid to politicians

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A key suspect in a snowballing financial scandal was recorded days before his arrest claiming that he gave hundreds of millions of won in bribes to ruling Democratic Party (DP) politicians, a local media outlet reported this week.

Sisa Journal, a weekly news magazine, on Wednesday reported on recordings it obtained of Kim Bong-hyun, the former chairman of Lime Asset Management, once Korea’s largest hedge fund. In them, Kim can reportedly be heard ordering a close associate to leak compromising information to the media about his alleged payments to DP figures, while saying politicians should be spared.

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The magazine reported that it verified the recordings. It has not released them publicly, but published partial transcripts of their content.

Kim, however, denied the report on Thursday afternoon, saying the conversations they contained are “senseless talks that fail to show who is talking.”

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The conversations suggested Kim systematically engineered the leaks about graft to actively discredit members of the ruling party, Sisa Journal reported, which directly contradicts the executive’s current claims that prosecutors deliberately put him up to the task to undermine the administration.

The magazine said the recordings were from phone conversations between Kim and his associate on March 20 and April 20, while Kim was on the lam over a financial fraud case that brought down Lime and generated around 1.6 trillion won ($1.4 billion) in losses for its investors. The second recording was made just three days before Kim was caught and placed under arrest.

Since then, the former executive has captured national attention over a series of surprising bribery allegations. The developments first plunged the DP into scandal but subsequently implicated figures from the opposition and state prosecution service, when Kim claimed in a letter to the media he also bribed them to evade investigations on his financial activities.

One notable figure Kim brought up in his testimony on the stand last month was Kang Ki-jung, President Moon Jae-in’s former senior secretary for political affairs, to whom Kim said he handed over 50 million won in cash last year, in an attempt to curry favor with the Blue House.

In one of the recordings, Kim’s conversation about Kang appears to be in sync with that testimony, Sisa Journal said.

“They’ll be able to check the Blue House entry records to verify” that Kim’s money — delivered through one of his partners, Lee Kang-se — had gone to Kang, Kim said in a transcript released by the magazine.

But several other high-profile DP names reportedly appeared for the first time in the recordings, along with specific details on how much Kim allegedly gave them money, and when.

At one point, he claims he gave a total of 250 million won to former Oceans and Fisheries Minister Kim Young-choon at an unspecified date in Ulsan, and several hundred million won to Rep. Ki Dong-min on three separate occasions ahead of Ki’s election. To DP Rep. Lee Soo-jin, a proportional representative, he claimed he paid for her trip to a beach resort in the Philippines.

Kim Young-choon, who lost his parliamentary seat in Busan in April and has since been appointed secretary general of the National Assembly, denied the allegations to Sisa Journal, saying he would sue Kim Bong-hyun for defamation if the executive testifies or tells prosecutors that any lobbying had occurred between the two. Ki admitted he received a suit from Kim Bong-hyun following the 2016 general election but denied taking any money.

Kang also defended himself, saying he did meet Lee at the Blue House but that there was no bribe exchange.

The recordings also reportedly appeared to back up Kim’s earlier claim that he had attempted to influence prosecutorial connections to affect the legal probe into Lime. Kim specifically mentioned lobbying former Prosecutor General Moon Moo-il and former Vice Justice Minister Kim Oh-soo through Lee and another legal representative.

In his letter to the media sent last month, Kim claimed he spent 10 million won ($8,700) on a party and gifts last year for three former and sitting prosecutors, including one later assigned to investigate the Lime case.

On Thursday, Kim’s defense team told the media that he told prosecutors Wednesday that the party took place on July 12 last year, and that records of that trip to a nighttime establishment in Gangnam District, southern Seoul, would be available in the navigation system of his car.

Complicating the investigation even further, Kim Bong-hyun is currently embroiled in another lawsuit against another suspect in the Lime case, Metropolitan Real Estate chairman Kim Young-hong. Kim Young-hong sued Kim Bong-hyun, demanding the defendant return money that a paper company run by Metropolitan had invested in another paper company run by Kim Bong-hyun.

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