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This page is graphically intense with long load times due to photos. However, the photos and narratives by the men who served at Osan Air Base makes the wait well worthwhile. The opinions expressed are those of the author and in no way represents any official statement of Osan AB or the USAF. 
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LEE MYUNG-BAK: PRESIDENT WITH CONSERVATIVE ECONOMICS?Lee Myung-bak is the former Mayor of Seoul and member of the GNP. Checkered past with allegations of campaign abuse, but allegations appear as partisan bickering. Lee Myung-bak, a former Seoul mayor. Mr. Lee, called "The Bulldozer," has an image of a hands-on, bricks and mortar kind of fellow. He earned his spurs as an executive at the construction arm of the Hyundai Group; he was elected to the National Assembly in 1996 and cemented his no-nonsense city-builder image as mayor from 2002 until the middle of last year. Largest claim to fame is the restoration of the Cheonggyecheon Stream. He renovated the Cheonggye Stream in the city's center, turning it into an urban park, and reformed the city's public transportation system. He wants to bring on the bulldozers on a national scale as well, championing a canal to run the length of the peninsula.
Lee's childhood portrays Korea's turbulent modern history. His impoverished parents had moved to Osaka, Japan, during the Japanese colonial occupation of Korea which lasted from 1910 to 1945. Lee was born in the Japanese city in 1941, where his father worked as a herdsman. Following Japan's defeat in World War II and Korea's liberation in 1945, his family returned home, and Lee spent most of his childhood in Pohang, a port on Korea's southeast coast.In Mar 2006, Lee's approval rating plummeted after allegations were raised that he had the free use of a public tennis court in return for business favors. Though the fees were paid by an anonymous donor, the cloud lingered over Lee's head over this seemingly trivial affair. Despite the affair, Lee still was well-thought of by constituents because of the Chyeonggyechun Stream project that has brought so much media attention to the area. For the 31 May 2006 elections, Lee stepped down as Seoul mayor paving the way for his run for the presidency. In May 2006, he had fallen from the front-runner amongst presidential hopefuls to third. In July 2006, after Park Geun-hye had stepped down as Chairman and replaced by Kang Jae-sup, the Lee Myung-bak faction saw the Party Presidential Nomination process to their disadvantage and attempted to change the rules. Although Park Geun-hye, former chairwoman, won the competition for the "supreme manager" of the presidential candidate race, the committee, whose role is to check and balance, was still left to be constituted. Lee Jae-oh, GNP supreme council member and Floor Leader, complained of the fairness of the presidential candidate race. Lee argued, "There was a structural limit to a fair party convention as one person had been controlling the party and the supporters in charge of the central party and local branches for a long time. We first need to constitute a fair competition committee with those we can trust." His underlying intention is to transfer the authority of presidential candidate race management to the committee -- instead of Park Geun-hye. It means that the "rules of game," including how to organize the electoral group, can be changed through the fair competition committee. According to the current party rules, the electoral group is constituted with 20 percent delegates, 30 percent party members, 30 percent general people, and 20 percent poll results. The ratio of party members and general people is half and half. Kang Jae-sup argued it was not the right time to change the rules and viewed a change in the constitution of the party was needed instead.. Members close to former Seoul Mayor Lee Myung-bak stepped up calls to allocate more votes to general public outside the party. They want "an open primary," in which all voters are eligible to cast ballots regardless of their party affiliation. Under the party's statutes, party delegates and registered members account for 50 percent of the voters, while the other half are non-member ballots. Lee's rival, Rep. Park Geun-hye and her supporters wanted to retain the current rules, which were revised last year under her leadership.  Seoul Mayor Lee Myung-bak In Jan 2007, things started getting nasty within the GNP ranks as Lee Myung-bak stated that anyone without children should not be President -- aimed at Park Geun-hye who is not married and without children. (SITE NOTE: Of course, this is patently ridiculous as Presidents throughout the world have been without children -- and what does having no children have to do with education or anything?) In response, Park Geun-hye fired back that people who have "evaded" serving in the military should not be President. Lee did not serve as he was exempted due to a respiratory condition. (SITE NOTE: Again what has this to do with qualifications to be President?) The mud-slinging had begun in earnest as the Uri Party was on the verge of dissolution and Goh Kun had dropped out of the race in Jan 2007. At that point, Lee held the lead in the popularity polls -- but so did Goh when he entered in 2006. In Feb 2007, the allegations made by a former legal advisor to Rep. Park Geun-hye against former Seoul Mayor Lee Myung-bak was swept off the table as not worth investigating. Park claimed that she told Chung not to pursue the matter several times. But Chung claimed the people needed to know of Lee's lack of ethics. Chung In-bong, a lawyer and former GNP lawmaker, submitted to the party's organizing committee for the primary election documents -- mostly newspaper clippings -- that raised questions about the integrity of Lee Myung-bak. The documents showed Lee violated the Election Law in the 1996 National Assembly elections. Lee was elected as a lawmaker in 1996. His aide at the time, Kim Yu-chan, said Mr. Lee spent more in campaign funds than he reported. Mr. Lee then urged Mr. Kim to flee to Hong Kong. The Supreme Court convicted Mr. Lee of election violations in 1998. Mr. Kim was also convicted in a separate case on the same election violation charge. Mr. Lee was fined 7 million won ($7,500), and Mr. Kim was fined 3 million. Neither served time in jail. However, Mr. Lee lost his Assembly seat in 1998 after the Supreme Court convicted him of the election law violation and of urging Mr. Kim to flee so he could avoid the charges. The party decided not to conduct an investigation into Chung's allegations as it had already been investigated with a conviction. Lee's side stated that even knowing about the 1996 case, the public still elected Mr. Lee as mayor of Seoul in 2002. However, it took back its initial response after Kim Yu-chan, a former aide to Mr. Lee in 1995 and 1996, came forward and admitted Lee had bribed him to perjure himself. On 20 Feb, Kim Yu-chan claimed he took 125 million won ($135,000) to lie during an election violation case. (NOTE: The Korea Herald said he received 120 million won ($128,000) from Lee in exchange for perjuring himself in the trial in 1997 and 1998.) Mr. Kim said he took the money in payments, starting in 1997, in return for perjuring himself on the stand. Mr. Kim himself originally brought forward the election law violation case, making the surprise revelation then that Mr. Lee had spent more campaign funds than he publicly reported in his 1996 National Assembly election race. Shortly after making the revelation, however, Mr. Kim left for Hong Kong, leaving behind a note saying his comments about Mr. Lee's violations were untrue. Mr. Kim said last Friday that he left for Hong Kong because Mr. Lee urged him to do so -- after he received $18,000, according to court transcripts. He returned the next year, in 1997, for the trials. Mr. Kim that Mr. Lee's aides arranged the perjury. "Mr. Lee's aides told me to say this and that at court for Mr. Lee," Mr. Kim said. "I know I am responsible for the perjury, but now I am telling the truth." Mr. Kim said he was planning to make more revelations soon against Mr. Lee in a book that he has tentatively called the "Lee Myung-bak Report." He plans to reveal details of Lee's morally questionable relationships with women and his acquisition of property, in the book to be released late February or early March. Former Seoul mayor Lee and former GNP chair Park showed a 2.9 percentage point drop and 2.5 percentage point drop in Feb 2007, respectively. Gallup attributed the drops to the recent spat between the two over alleged wrongdoings. (NOTE: Though no action was taken by the GNP because of the damage it would do to its image, the act has placed the fact before the public as the media reported it widely -- though initially NOT mentioning anything about the conviction in their coverage of Lee's campaign. This says something of how the media views politicians as corruption is accepted -- but only becomes interesting when mud is being flung. Chung initiated the allegations of Lee's "lack of morality" with the purpose publicizing Lee's ethical suitability for President. Lee and Park have been competing to win the GNP's ticket to run in the Dec. 19 presidential election. Since last October, Lee has topped polls with a more than 40 percent approval rating followed by Park with about 20 percent.) In Apr 2007, with Lee ahead in the polls, the sniping between Lee and Park heated up. The GNP tried to change the rules of the nomination process for the GNP with both Lee and Park proposing different processes. After the chairman of the GNP backed Lee's proposal, Park hinted that she may remove herself from the nomination process -- an indication that she might run as an independent -- though she denied this. On 11 May 2007, Lee became the first of the GNP to officially his running for the presidency. Lee Myungbak criticized the current administration's unconditional economic and humanitarian aid and claimed the ROK must help the economic development of the communist nation instead of providing exhaustive support. He suggested that if DPRK abandons its nuclear weapons, the ROK would help them achieve a national per capita income of $3,000 within 10 years. He claimed that it would be possible through aggressive aid in collaboration with the international community; once Washington first remove Pyongyang from its terror-sponsoring nation; but Park criticized this plan that, in order to receive the help of international community, the DPRK must recover its trust from the international community, but it would be very difficult. Lee added that the DPRK had asked to reach $5,000 and stressed the fact that DPRK has shown interest in this plan. Lee also stated he would make a meeting place for dispersed families at the DMZ since this way, DPRK would not need to feel uncomfortable for coming down South, it would save a lot of costs, and more people would be able to meet their separated families. Lee's Canal Plan Ridiculed In May 2007, there was opposition to Lee's canal plan to construct a canal to run the length of the peninsula. Park Geum-hee attacked the plan as a waste of money. In June 2007, with Lee Myung-bak refusing to accept Park Geun-hye's demands for Lee to withdraw his pledge for a cross-country canal, which is a key plank in his campaign platform, debate over the proposed canal was heating up. The Park faction states that such a cross-country canal is not needed and it would take 60-70 hours for cargo to travel from Seoul to Pusan. The Lee faction states it would take 24 hours and would greatly enhance the economy. The government issued a report against such a canal, but it was held up from public release for unknown reasons in May 2007. Then a "draft" of the government report was leaked in June that claimed the project was not economically feasible. Lee's faction immediately pointed the finger at the Roh administration as Roh was still attacking Lee despite a ban from NEC. The NEC launched an investigation. The revision report on the Seoul-Busan canal from the Korea Water Resources Corporation is identical to the 37 page document disclosed by the press except in the name of writer on the cover and a line in the conclusion written by the Ministry of Construction and Transportation.. Lee Suspected of Hidden Wealth On 5 Jun 2007, a rumor by a GNP lawmaker circulated that Lee Myung-bak had created a trust fund of some 800 billion won (about $850 million) in the name of his relatives. Rep. Kwak Sung-moon said in a radio interview that he had received such information which he claimed was ``valid.'' However, Kwak had no evidence to substantiate the rumor. Park Geum-hee supporters stated that it had nothing to do with the rumor, but since the financial status of Lee will come out in the campaign, he should make his finances clear. The GNP is accusing Lee of double-talk when addressing the questions. Lee stated he had no land under other people's names, but the GNP stated he didn't say if he had land under his family or relatives names. By 6 Jul the rumors of Lee's land speculation with his brother and brother-in-law were rampant. Though he has repeated denied any wrong doing, he continues to remain under attack. Further accusations have been made that Lee used his power as governor of Kyonggi Province to increase the value of his real estate. Though Park Geum-hee does not support these rumors, she stated that Lee should reveal his finances -- which in turn continues to fuel the controversy. Lee asked his brother to reveal his finances, but his brother stated that his finances had nothing to do with politics. Lee has accused President Roh of releasing information to inflame the accusations. Most of the attacks by the Uri Party legislators appear unfounded. Lee Myung-bak's brother-in-law Kim Jae-jeong (58) filed a libel case against GNP lawmakers Yoo Seung-min and Lee Hye-hoon, former lawmaker Seo Cheong-won, and the Kyunghyang Daily newspaper, which said he was involved in real estate speculation. Former GNP Chairwoman Park Geun-hye declined on 11 Jul to offer an apology for raising suspicions over her rival Lee Myung-bak's link to dubious property deals. Park confronted Lee with her suspicions that he is the true owner of lucrative property that was registered to his brother-in-law, Kim Jae-jeong. In return, Kim filed defamation suits against Park Geun-hye. He refused to drop the case even though the GNP and Lee camp demanded him to do so. On 12 Jul, the Seoul Central District Prosecutors` Office investigated the defamation suit over leaked government documents detailing Lee`s real estate practices. On July 11, it said that the Prosecutors' Office found that 10 people accessed Lee's personal information by analyzing information given by the Ministry of Government Administration and Home Affairs, the Ministry of Construction and Transportation, National Tax Service and the Korean National Policy Agency. The information accessed for the last three years was mostly Lee's criminal records. The prosecution is investigating who accessed them and why, and if any of them were leaked outside. The prosecution is considering asking the National Intelligence Service to submit related information in order to get to the bottom of the so-called 'Lee Myung-bak X-file leakage.' Prosecutors said proceeds from the sale of land in Dogok-dong, southern Seoul linked to Grand National Party frontrunner Lee Myung-bak were invested in a company he also has ties to. Lee has been accused of concealing his assets by registering the land in the names of his brother and brother-in-law, but Lee Sang-eun and Kim Jae-joung insist they were the actual owners and purchased and sold it together. But prosecutors on Wednesday said they have evidence that a man named Lee Young-bae, an asset custodian both for the presidential hopeful and his brother, put the brother's share of W10 billion (US$1=W932) from profits of W26.3 billion from the land sale in a low-interest long-term insurance policy in December 1995 and provided the principal as collateral to borrow several billion won. The loans then went to a company linked to Lee Myung-bak, according to prosecutors. However, Lee Young-bae, the custodian, refused to appear for questioning on a summons and the investigation stalled. By releasing the interim results, the Prosecutors have seriously impacted on Lee's campaign. In Aug, Park's camp was focusing on the land issue, believing that the investigation results will corroborate their own allegation that Lee is a less-than-solid candidate and the matter could prove an eleventh-hour variable in the primary. Lee had a 10 percent lead in opinion polls. Prosecutors said proceeds from the sale of land in Dogok-dong, southern Seoul linked to Grand National Party frontrunner Lee Myung-bak were invested in a company he also has ties to. Lee has been accused of concealing his assets by registering the land in the names of his brother and brother-in-law, but Lee Sang-eun and Kim Jae-joung insist they were the actual owners and purchased and sold it together. But prosecutors on Wednesday said they have evidence that a man named Lee Young-bae, an asset custodian both for the presidential hopeful and his brother, put the brother's share of W10 billion (US$1=W932) from profits of W26.3 billion from the land sale in a low-interest long-term insurance policy in December 1995 and provided the principal as collateral to borrow several billion won. The loans then went to a company linked to Lee Myung-bak, according to prosecutors. However, Lee Young-bae, the custodian, refused to appear for questioning on a summons and the investigation stalled. By releasing the interim results, the Prosecutors have seriously impacted on Lee's campaign. In Aug, Park's camp was focusing on the land issue, believing that the investigation results will corroborate their own allegation that Lee is a less-than-solid candidate and the matter could prove an eleventh-hour variable in the primary. Lee had a 10 percent lead in opinion polls. In Nov 2007, Lee stated while campaigning that he would give up his personal wealth if elected President. He stated all he needed was a house to live in after he retired. Whether this rhetoric was all for show or not, is yet to be seen. It does not have any binding force -- though his opponents may want to make it an issue. Cheong Wa Dae Files Libel Suit (Oct 2007) Cheong Wa Dae continued "waging a war" against Lee Myung-bak. In regular daily briefing sessions Cheon Ho-seon, Cheong Wa Dae spokesperson, criticized the former mayor for the Lee camp's accusations regarding the government's political maneuvering and his campaign pledges on taxation -- calling it "Imprudent political libeling." On 20 Oct the Seoul Central Prosecutors' Office issued a subpoena to Lee Myung-bak and three other GNP party leaders for questioning as part of a libel investigation. Many experts say the prosecution's measure may spark political conflicts between the GNP and the prosecution since it is rare for the prosecution to summon a presidential candidate of the opposition party ahead of the presidential election. President Roh Moo-hyun`s secretaries filed a suit on 7 Sep against Lee Myung-bak, Chairman Lee Jae-oh, floor leader Ahn Sang-soo, and senior party member Park Gye-dong over the GNP`s allegations that the presidential office was masterminding a scheme to damage Lee`s campaign. The prosecution also summoned an administrator of the presidential secretariat as the representative of the accuser on 28 Sep. The GNP position is that the party already handed in a request to probe the National Intelligence Service, the National Tax Service, and Cheong Wa Dae, which allegedly collaborated to raise suspicions over Lee's real estate transactions. As the investigation is underway, the libel case (proposed by the presidential office) should be dealt with after the ongoing investigation. Thus the GNP has in effect refused the prosecution's request to question Lee. After Lee was elected, the transition team made it very clear that they wanted all paperwork intact and would not tolerate any shredding of documents. It seems apparent that once the Lee administration would take office, it was going to attempt to track down the depth of the Cheong Wa Dae involvement in the persecution of Lee. Political In-fighting Damages GNP (Jul 2007) In Jul, the infighting between Park and Lee continued. As allegations of Lee's involvement in land deals continued, his lead in the polls started to slip -- narrowing the margin between he and Park to under 20 points. However, because the fighting between the candidates were so intense, when Lee won the primary, the split could not be healed. It had gone past being politics, but had become personal. In addition, Park also sensed that Lee was going to ursurp her role in the GNP leadership once in power -- and this indeed proved true when he became President-elect, he stated that some would have to make "sacrifices" for the sake of the party. This would impact on the April 2008 elections where the GNP was expected to win a landslide victory as well -- and Lee's actions would undercut Park Geum-hee's power base. LEE WINS GNP PRIMARYPresidential hopeful Lee Myung-bak defeated rival Park Geun-hye by a narrow margin on on 20 Aug to win the Grand National Party's nomination to run for the 2007 presidential race. Following the results of the vote, the "battle" between Lee and Park, which has dragged on for over a year, came to an end, while the GNP geared itself up for the presidential race. But the fact that Lee defeated Park by a mere 2,452 votes (1.5 percentage point difference) may serve as an obstacle in uniting the two rival camps within the GNP. The GNP presidential candidate selection procedures included a vote of some of its party membership and the factoring in of a public opinion poll. Park Geun-hye won the party vote, but was held back by the opinion poll, and so Lee Myung-bak emerged as the winner. Park congratulated Lee on his win and vowed to return to being a GNP party member working to bring about a change in government -- BUT she did not openly support Lee Myung-bak's campaign. To the end of the election process, Park supported Lee as the GNP candidate, but never gave him her personal endorsement -- at the same time rebuffing all of the liberal candidates enticements to support them.The progressive ranks were in disarray, and Lee enjoyed a commanding lead. However, in October the progressive strategy seemed clear. They were going to attempt the same smear campaigns that led to the defeat of the GNP candidate in 2002 -- along with alliances at the last minute to increase their share of votes. However, this time they chose the "BBK" scandal as their rallying point. To an outsider this smacked of government interference as a special effort was made by the government agencies to investigate -- including illegal search of documents -- wire-tapping and other means to find dirt on Lee Myung-bak. The investigation still was on-going as the presidential elections neared. In addition, the progressives drew the battle lines based on ideological lines painting the GNP as the party of the rich and business. Even President Roh -- who had been censured twice for electioneering -- reentered the fray in Oct to make disparaging remarks against Lee. Candidate Chung Dong-young is attempting to turn the campaign debate into an ideological battle, and President Roh seems to be trying to back him up. However, Roh's choice was Lee Hae-chan, the man previously hand-selected to succeed him, but who failed in the UNDP primaries. Along the way Chung Dong-young alienated himself from Roh -- calling for Roh's resignation from the Uri Party and distancing the Uri politics from Roh -- and there were hasty attempts at fence-mending. In Oct Roh finally endorsed Chung for the presidency. Chung and Lee differed on support of Chaebol's operating their own banks and views of economic growth. Lee was for the chaebol's entering the financial markets, while Chung was opposed. The Korean Chamber of Commerce and Industry (KCCI) stated that the separation of financial and industrial capital is a policy that restricts industrial capital, including that of conglomerates, from being invested in a bank for ownership. The separation of financial and industrial capital should be relaxed, and a growth-oriented policy should be implemented. Meanwhile, the Bank of Korea is opposed to the idea. Lee Myung-bak dismissed Chung Dong-young's proposal for a public debate on key national issues and values. Ex-Seoul Mayor Lee, is well known for his blunt word choices, while Chung, a former MBC anchor of the nightly news, is widely known for his political rhetoric. The GNP stated that Chung still is only one of three progressives vying for the presidency so it would be inappropriate at this time. Observers note that Chung is attempting to push Lee around through a series of debates, in turn building an image of himself as a qualified leader with vision and specific plans for the economy. Previously, the former unification minister characterized his rival Lee as an advocate of the upper class and a ruthless neoliberal pro-business candidate. Lee responded that Chung is a candidate of rhetoric with no content. GNP spokesman Park Heong-joon said that Chung was attempting to divide society into two opposite groups to unify liberals and to motivate undecided voters to join an ideological debate. Chung Dong-young said he is the candidate for low-income families and for peace on the Korean peninsula. Chung continued to focus on his slogan regarding the ``upper 20 versus the lower 80'' as his key campaign issue. The Chung said his rival Lee Myung-bakwas a candidate for the top 20 percent of the population, while he represented the remaining 80 percent. He portrayed the GNP as "brutal conservatives" versus the UNDP as "peace-loving progressives." On 25 Oct, Lee Myung-bak slipped slightly -0.2 percent to 50.1, while the progressives except Rhee In-je moved up slightly. In order to blunt comments of his contributions to the demise of the Uri Party, Chung admitted that he bore some responsibility for the failures of the Uri Party. Of course, as he resigned after the defeat of the Uri Party in Apr 2007, he has to do so -- especially since he's trying to take the bows for the Kaesong Industrial Park creation. A last minute worry for the Lee Myung-bak camp was the persistent rumors that Lee Hoi-chang would reenter the race. A group of supporters for Lee Hoi-chang planned to hold a rally calling for Lee's run for the Dec. 19 presidential election on 23 Oct -- though Lee Hoi-chang stated that his position was as before that he was not running. The move comes amid speculations that Lee, former chairman of the GNP, could participate in the presidential race as an independent if Lee Myung-bak becomes crippled by the BBK scandal. This would effectively split the vote and weaken Lee Myung-bak's position. In order to attempt to offset Lee Hoi-chang's potential bid, Lee Myung-bak offered an olive branch to Park Geum-hee to solicit her support. However, Park refused to meet with Lee. Though Lee Myung-bak still has the lead, the 20 percent support for Lee Hoi-chang has cut into his commanding lead. There is a quandary over how Lee Myung-bak will solve this crisis. Lee offered to share the power with Park on 12 Oct -- meaning the selection of candidates for the April 2008 elections -- as a peace offer. On 8 Oct, Lee Myung-bak won approval ratings of 37.9 percent, late entrant Lee Hoi-chang 24 percent and United New Democratic Party's Chung Dong-young candidate 13.9 percent in a survey conducted immediately after Lee Hoi-chang announced his third presidential bid. Lee Myng-bak's approval ratings were practically flat since the last poll on Oct.31, when he scored 38.7 percent. Chung witnessed a 3.2 percentage point drop in his support ratings, while Lee Hoi-chang saw a surge from 19.1 percent to 24 percent. Korea Herald reported on 12 Nov that Park Geun-hye, former GNP chairwoman, offered her support to the party's candidate Lee Myung-bak -- sort of. "I remain unchanged in my view that the party must win the election, and I will do my best to help," Park told reporters. She added "it is not right for Lee Hoi-chang to compete again." Park stopped short of using the term "support" for Lee Myung-bak and appeared negative about Lee's earlier offer of regular three-way meetings with her and GNP chairman Kang Jae-sup -- a proposal that appeared to assure her of the party leadership if Lee is elected. She also appeared to blame Lee Myung-bak at least in part for Lee Hoi-chang's defection from the party. It seems the ex-party chairwoman, Lee Myung-bak’s arch-rival in the party primary, wanted to leave herself room for maneuver depending on whether the suspicions are cleared and what the candidate’s camp does next to seek party unity and reform. BBK SCANDAL (Oct 2007 -- On-going)Lee Denies Involvement in BBK (Oct 2007) Lee Myung-bak stated he had no shares in BBK, but the GNP stated the question was whether he exerted managerial control in BBK. However, on 18 Nov his extradited ex-partner, Kim Gyeong-jun (Christopher Kim), claimed that Lee was the owner of all companies involved in the BBK scandal. A special investigation team at the Seoul Central District Prosecutors' Office investigated whether Lee was involved in the scandal. Lee was suspected of being implicated in the stock price-fixing of Optional Ventures and of concealing assets because his relatives allegedly held DAS in proxy for him. The allegations come from the UNDP. Kim has claimed all companies involved were in fact owned by Lee. Kim was questioned on 18 Nov. The prosecution summoned Kim Sung-woo, the head of DAS, to ask questions about why his company invested 19 billion won (US$20.4 million) in BBK. Kim reportedly told the persecution that GNP candidate Lee had nothing to do with his company's investment in BBK. (SITE NOTE: When asked what the mysterious abbreviation BBK means, Kim during the investigation answered "Bank of Bahrain and Kuwait", insinuating involvement by Lee Myung-bak, who has good connections in the Middle East. But prosecutors concluded it is actually a combination of the initials of Kim, his wife Lee Bo-ra and Bobby Oh, who are promoters of the company.)According to a February 2006 disclosure statement, Lee has assets worth 17.9 billion won, including land worth 608 million won under his wife's name as well as buildings he owns worth 16.5 billion won. Lee's 48 percent share in LK-eBank, worth 3 billion won, was part of his assets. LK-eBank was founded jointly by Lee and Kim Gyeong-jun (Christopher Kim), the founder of BBK. BBK is an affiliate of LK-eBank. After Kim was suspected of embezzling 38 billion won, he fled to the United States in December 2001 with a forged passport, when the authorities were looking into an alleged market manipulation involving Optional Ventures. Kim's company BBK retained a majority of Optional Ventures shares at that time. Kim was arrested in May 2003 at his residence in Beverly Hills and was ordered to be extradited the following year, but he filed an appeal to resist being sent back. Kim is one of the co-founders of BBK, a now-defunct asset management company established in 1999. Lee Myung-bak also was a co-founder. Kim allegedly had floated rumors that the company would be acquired by a foreign company, misleading investors who helped raise the company's stock price. After Kim was suspected of embezzling 38 billion won, he fled to the U.S. on a forged passport in his dead brother's name and has since remained. The business partnership between Kim and Lee lasted for one year and the partnership ended after the nation's financial supervisory body concluded Kim made false accounting reports in 2001. (NOTE: In 2001, Kim illegally entered Korea on five occasions on a forged passport in his dead brother's name.) When the Financial Supervisory Service revoked the license of Optional Ventures Korea on March 8, 2002, a company employee called up Chris Kim who had already fled to the U.S., and informed him that the prosecution had frozen the company's bank accounts. Chris Kim then called the employee back and ordered him to send all documents and records related to him and his wife over to the United States. The employee went straight to a warehouse run by a delivery service company in Gyeonggi Province. Chris Kim had stashed all the documents and the company safes there. He feared shareholders would storm into his company, learning about his fraud.Lee was cleared by the GNP investigation, but politics led to the involvement of the prosecution to investigate the entire case. Lee claimed he did not know of Kim's alleged scam and denied being involved in company management. In Jun 2007, when these old charges were resurfaced, Lee decided to let this storm blow over by saying he encouraged his accusers to investigate the matter and to clear up the matter. On 22 Jun the GNP candidate verification committee said that there was no evidence to support charges that Lee Myung-bak was involved in real estate speculation. Kim Gyeong-jun (Christopher Kim) first got arrested in May 2003 in the Los Angeles area and ordered extradited in 2004. In October 2005, he was ordered to report to Korean authorities. In response, Kim filed a habeas corpus petition, citing a pending civil action. But on 8 Oct 2007, he voluntarily dismissed his appeal. In Oct 2007, the 9th Circuit Court of Appeals in San Francisco approved a request filed by Kim Gyeong-jun (Christopher Kim) to withdraw his appeal against his repatriation. Formally, Kim is under investigation for allegedly embezzling nearly 40 billion won (US$45 million) from BBK, which he founded and served as president, while manipulating stock prices and claiming that one of his companies was about to get a huge infusion of foreign funds.Joongang Ilbo on 25 Oct reported that a hearing with the potential to embarrass presidential front-runner Lee Myung-bak was still on track before the election in December, as a US court denied Lee's motion to keep a former business partner facing criminal charges in Los Angeles. The US Attorney said that Lee's claiming that the extradition was politically motivated was "inappropriate." The U.S. Ninth Circuit Court of Appeals' decision means that Kim Gyeong-jun, currently in detention, is likely to arrive in the ROK in late November. The Ministry of Justice said it was notified by the South Korean embassy in Washington on 31 Oct that U.S. authorities approved the extradition of Kim Gyeong-jun. It says Kim will be handed over to South Korean authorities in Los Angeles for a trip to Seoul -- at about mid-November. In Washington, it proved to be a no-win situation. If they approved the release, they stood to possibly alienate the future President of Korea. If they didn't, they would be accused by the UNDP of playing favoritism towards Lee. Expectations were that Kim will be in Korea perhaps a week before the election. When Kim arrived in Korea, the prosecution planned to book and arraign him within 48 hours. Then it would look into various allegations involving Kim, including the manipulation of Optional Ventures' stock price, and DAS's investment of 19 billion won in Kim's company BBK. DAS has been owned by the brother and brother-in-law of Lee Myung-bak. Kim is a legal fugitive and wanted by the Seoul Central Prosecutors' Office. Kim will also be questioned as a material witness in a case arising out of candidate Lee's alleged ownership of DAS shares under a third-party name. Currently the US has garnished approximately $23 million of Kim's funds, but will return $400,000 to be used for legal fees. Since he fled to the US in 2001, Kim reportedly examined documents and records related to BBK and the firm Optional Ventures. The DA's office expects Kim to produce some of the documents to support his allegations, for example, that GNP candidate Lee was involved in the price manipulation. If his allegations were proven to be true, the documents would significantly affect the future investigation. Legal experts expect that Kim will produce documents such as a copy of, if any, a secret written agreement with Lee attesting to Lee's ownership of BBK, instruments showing how and why Lee's brother and brother-in-law invested 19 billion won in that company, and/or transcripts of his conversations with Lee. The United New Democratic Party has voted to hold a hearing after Kim returns. The party wants Kim to testify about alleged irregularities involving the now-defunct firm BBK in order to embarrass Lee Myung-bak. UNDP lawmakers have claimed the GNP nominee was involved in stock manipulation and money-laundering as he co-headed the asset management firm. The Prosecution is conducting its own investigation. UNDP lawmaker Kim Jong-yull told reporters he would offer testimony on the scandal and submit relevant pieces of evidence, and urged the GNP to fully cooperate with the investigation. Analysts on the UNDP side predict that the stock manipulator will be ready to cooperate with the prosecution in return for lighter criminal charges. According to them, Kim is expected to provide evidence that he colluded with the GNP nominee in the stock manipulation and that Lee is the co-owner of the fund in question. Prosecutors hoped to conclude the investigation before the Dec. 19 election. The investigation seemed to be the play of last resort for UNDP standard-bearer Chung Dong-young to boost his lackluster popularity. To minimize the harmful impact on the election, authorities have tracked relevant banking transactions regarding the allegations. Based on those records, they will question Kim and determine whether or not his documents support his allegations.The situation was confused in late October. The Hankyoreh on 26 Oct claimed that a brochure "proved" that Lee was involved in the BBK and that he had used a credit card for the BBK. In addition, it was reported that Lee supposedly had not authorized his lawyers' in the states to prevent extradition -- but this seems to be less than credible given his actions to not stop the move. The GNP and Lee's aides are very worried about the impacts. This strategy is the same that was done by Roh in the 2002 elections against his opponent. In anticipation, the UNDP is making plans to have Lee testify before the National Assembly to make the most of the smear technique. On 18 Nov, Kim Kyung-jun (Christopher Kim) was arrested on charges of stock price-fixing. The 41-year-old Korean American was extradited to Seoul on 16 Nov. Kim was charged with manipulating the stock price of Gwangun Venture Business Inc before it became Optional Ventures Korea when he took it over; diverting W38.4 billion of company funds into the accounts of an American paper company; and fleeing to the U.S. with a forged passport in December 2001. The warrant charges consist of three parts, apparently the same as those on the Korean government's request to the U.S. government for his extradition.
Kim embezzled an extra 9.1 billion won according to prosecutors. He nominally returned 1.1 billion won to DAS, Inc. in November 2001, and 2.4 billion won to Sim Tech, which were not previously detected by the law enforcement agency. Further, Kim paid 5.6 billion won as severance fee to a former American CEO in March 2002. (SITE NOTE: Prosecutors stated that investigators "confiscated a DVD of the movie 'Boiler Room' from the former president's desk in the Optional Ventures office. "Boiler Room" was released in the U.S. on Feb. 18 in 2000 and in Korea in October. The movie won the Jury Special Prize at Deauville Film Festival. It is directed by Ben Younger and stars Giovanni Ribish, Vin Diesel, Ben Affleck and Nia Long. The movie's story is nearly identical to the scam. Kim set up Optional Ventures when BBK folded due to forged investment reports. The paper company used to swindle people out of their savings in the movie is called Med Patent Technologies -- a name Kim gave to a bogus company he set up in the process of stock manipulation. And Kim used the name of one of the stars of the movie, Giovanni Ribisi, for a fictional representative of the bogus company. Prosecutors believe Kim also copied the ingenious stock manipulations in the movie that make it look to gullible small investors as if the shares are performing miraculously well. In the movie, Seth Davis, played by Ribisi, gets rich by manipulating stock prices to make his investors paper millionaires overnight before the stock plummets to nothing. Kim himself embezzled a whopping W39 billion (US$1=W923) in less than a year from investors in the scam. Seth in the movie buys a big house and five luxury cars including a Ferrari and Porsche with his ill-gotten gains. Kim purchased two houses in Beverly Hills and a Mercedes. In "Boiler Room", Seth slips away when FBI agents raid his office -- much as Kim disappeared from Korea. (Source: Chosun Ilbo.)) The investigation was known to focus on a photocopy of a Stock Purchase and Sale Agreement in English signed by LKe Bank and AM Papas, a paper company registered as a tax haven. LKe Bank was co-founded by Lee Myung-bak and Kim Gyeong-jun. But prosecutors planned to investigate the circumstances concerning why Kim has pushed for a settlement because the English document presented by Kim does not contain content about a backdoor agreement. Seoul Central District Prosecutors` Office probing the BBK stock price manipulation scandal were NOT likely to announce their findings before November 26, the last day of presidential candidacy registration. Prosecutors are expected to disclose the findings while filing charges against Kim Gyeong-jun on December 5, the day when his arrest warrant expires. But after election registration ends, the next steps in the legal process, such as charging a presidential candidate, will be difficult. The investigation results may not even be disclosed right away. The preliminary report was expected on 25 Nov, but had to be delayed until 5 Dec -- and even then without certainty. The authorities obtained the official seal management files of LKe Bank, which Kim and Lee founded together in February 2000. The prosecution is checking the impression of Lee's official seal on the file with the impression on an agreement in Korean that Chris produced and submitted. On 23 Nov Lee Bo-ra, Kim's wife, held a press conference showing copies of the four side contracts -- three in English and one in Korean bearing Lee Myeong-bak's supposed personal stamp. On 23 Nov, Kim's sister, Erica Kim, stuck to the family's claim that there are four "under-the-table" contracts proving that Lee owned BBK. She said one of the four contracts "is written in Korean and proves that Lee himself owned BBK. It reads in part, 'BBK stocks owned by Lee Myung-bak.' This statement on the contract is affixed with candidate Lee's own personal seal." Asked why she failed to present such important documents to the court before, she said, "For three-and-a-half years, we've fought in court only over the matters related to Optional Ventures," the company whose stock price Kim is accused of manipulating. "It was not an extradition case related to Lee Myung-bak." In an interview with a local newspaper, Erica Kim released original copies of the behind-the-scenes contracts, which allegedly contain candidate Lee Myung-bak`s agreement to sell 610,000 stocks of BBK to Kim for five billion won. The documents were written in Korean on two pages of A4 format and were titled, "the contract of stock-dealing." The Korean-language agreement was written on February 21, 2000, and the three English-language agreements were written on February 21, 2001. The Korean-language agreement was marked with two stamps, one each from Lee and Kim. The English-language agreements were signed by three to five people, including Lee and Kim. Titled "stock sale contract," the two-page, A4-sized Korean-language agreement states that a "seller, Lee Myung-bak," sold 610,000 shares in BBK to LK e-Bank President Kim Kyung-jun for 4,999,995,000 won (US$5,358,822). If the document is genuine, it will mean that Lee was the real owner of BBK until February 21, 2001, as Kim has claimed. On 23 Nov Kim's mother flew in from LA carrying the documents. The Kims claim the documents will show a clear link between Lee and Kim involving the defunct investment firm BBK from which the scandal takes its name, although Kim was extradited on charges relating to a firm he set up after BBK folded called Optional Ventures Korea. Asked why they did not send the documents earlier, they stated they feared that Lee Myeong-bak would alter his signature if the documents were released earlier. The GNP continued to characterize the statements as lies by a family of swindlers. As for Lee Myung-bak's personal seal, which in Korea is widely used in lieu of a signature on certain documents, his campaign committee spokesman Park Hyung-joon said, "At the time, the seal was kept by Kim Kyung-joon." Park also implied the documents may be forged, saying, "We have suspicions about the fact that the affixed seal on such an important contract was not accompanied by a signature." The GNP immediately responded that Lee's seal used on the documents were different from Lee's registered stamp. On 26 Nov, Kim Kyung-jun's legal representative, Oh Jae-won, said that the seal shown in a written agreement that Kim's mother submitted to the prosecution is that of Lee Myung-bak and was proven to be identical with the one on the corporate book of LK-eBank, one of BBK's de facto holding companies. On 5 Dec, prosecutors announced their findings. Senior prosecutor Kim Hong-il of the Seoul Central District Prosecutors' Office in a press conference said his team found no evidence that Lee was involved in the so-called "BBK Scandal" or is the real owner of a company called DAS registered in the name of Lee's brother and brother-in-law that was heavily invested in the defunct investment firm BBK. The two issues and what they could mean for Lee's election prosepects had emerged as the centerpiece of a probe ostensibly launched to indict the business partner, Kim Kyung-joon. Meanwhole, the integrity of the probe has been called into question by a leaked note in which Kim claims prosecutors offered him a lenient sentence if he testified favorably to Lee. According to current affairs magazine SisaIN, Kim gave his mother-in-law a note saying prosecutors offered him a three-year sentence if he made statements favorable to Lee but seven to 10 if his testimany was unfavorable. Prosecutor Kim denied the claim, saying the entire questioning process was recorded and video-taped and conducted in accordance with the law. (SITE NOTE: The note was later called a forgery and the Prosecutor's office filled a libel suit against Kim for damaging their reputation.) On 5 Dec senior prosecutor Kim Hong-il announced the findings of an investigation into a financial scandal centered on the former business partner of Lee Myung-bak. Prosecutors cleared Lee Myung-bak of alleged involvement in an investment scam and charges of asset concealment. They said there was no evidence that Lee was the real owner of dubious investment firm BBK or auto parts company DAS. The office reached the conclusion 29 days after a special investigation team was set up to start looking into the allegations. Kim Kyung-joon, Lee's former business partner who ran BBK and other firms linked to the scandal, was indicted on charges of stock price manipulation and embezzlement centered on a boiler-room operation called Optional Ventures Korea. But prosecutors said they found no evidence that Lee had been involved in or benefited from the investment scam. According to prosecutors, witnesses who had worked for Kim testified that they received their orders directly from the accused. Prosecutors dismissed allegations that Lee had been the real owner of BBK. According to prosecutors, Kim in the course of the investigation changed his testimony and admitted holding a 100 percent stake in the defunct firm. There also apparently exists a memo written by Kim in February 2001 that says he would maintain a 100 percent stake. Prosecutors dismissed documents Kim and his family claimed were under-the-table contracts proving Lee's part-ownership as forgeries. Lee was also cleared of asset concealment in connection with DAS, which is registered in the names of his brother and brother-in-law. Prosecutors said there was no proof that Lee received dividends from DAS or participated in the decision-making process of the company. DAS had invested W19 billion (US$1=W923) in BBK, money Kim claimed came from Lee. Kim was indicted on charges of embezzling W31.9 billion from Optional Ventures from July to October 2001, manipulating the company's stock price, forging seven passports and 19 documents involving the establishment of a U.S. subsidiary. Prosecutors were considering seeking the extradition of his sister Erica Kim, who was suspected of colluding in the embezzlement. Prosecutors decided to ask U.S. authorities to extradite Erica Kim to charge her with complicity with her brother in establishing bogus companies and transferring huge amounts of money to overseas bank accounts. They also planned to question Kim's wife Lee Bo-ra as soon as she returned to Korea on suspicion that she had a direct part in the boiler room scam and management of BBK. But the United New Democratic Party, which had brought a criminal complaint determining the focus of the investigation, has already decided not to accept the investigation results, citing Kim's claim. In an emergency meeting, the UNDP decided to demand a fresh team of investigators start looking into the case again from scratch. It also plans to initiate a bill appointing a special scounsel to probe the scandal. The announcement that the Prosecution had cleared Lee of charges caused other candidates to sit and sputter. Throughout the fiasco, Lee had maintained a 40 percent voter share in the polls, with others falling behind. A survey, conducted by The Korea Times and its sister paper the Hankook Ilbo, on 6 Dec, showed that 40.7 percent of voters support Lee while 17 percent and 16.5 percent support independent candidate Lee Hoi-chang and Chung Dong-young of the United New Democratic Party (UNDP), respectively. Meanwhile, the turnout was predicted to be high at the upcoming presidential election as 92.2 percent of respondents said they will show up to the polling booths while 7.3 percent had no plan to vote. Other polls showed that 47 percent of the voters perceived Lee of wrong-doing during this six-month fiasco, but still supported him in the polls. It was evident that they were more concerned with his ability to "move" things along -- meaning the economy and jobs -- and that the voters had lost complete faith in the progressives. The progressives on the other hand, hoped that the scandal would deal them a hand like it did during Roh Moo-hyun's run for the presidency where false allegations sunk Lee Hoi-chang's bid for the presidency. Now with the prosecution clearing Lee of involvement, all of the candidates had to fall back and regroup. Interestingly, a poll on 6 Dec showed 48.6 percent of respondents have no faith in the prosecutors' findings, as against 46.4 percent who do. Some 47.2 percent supported the UNDP's demand for a special counsel to look into the BBK scandal and Lee Myung-bak's involvement again, while 44.4 percent were against. This was occurring simultaneously as Lee Myeong-bak leaped to a 43.9 percent lead in voter popularity. In response, the GNP launched a counter-attack. The GNP on 7 Dec disclosed a CD containing conversations between one of Kim's American fellow inmates at a Los Angeles detention center and his lawyer, while citing an article of a newspaper. The fellow prisoner told his lawyer about the involvement of high-ranking Korean pro-government officials and their attempt to make a big deal with Kim. According to the English conversations recorded in the CD, Mr. Zigetta, the fellow convict, said, "I think people who seemed to be top level pro-government officials from Korea visited him (Kim Gyeong-jun) from March. Kim told me that things are going smoothly and they proposed him a special deal." "Kim Gyeong-jun told me that he had to testify something he knows in return for a pardon or a lighter punishment," he added. The GNP not only launched its own investigation team to probe the claim, but also called for prosecutors to immediately launch an investigation into the allegations. "The prosecution must dispatch prosecutors to the U.S. at once to find out who visited Kim. A simple examination of the list of visitors to him in the detention facility will suffice to unveil the purported visitors," said Ahn Sang-soo, floor leader of the GNP. (Source: Donga Ilbo.) In an unusual twist, the opposition to Lee Myeong-bak have turned to aid in the legal defense of Kim after two of his lawyers quit. Oh Jae-won tendered his formal resignation to the court after Park Su-jong, apparently felt the political repercussions of the case are too much. But Kim already has a new legal team. He hired two new lawyers with the aid of the camp of independent presidential candidate Lee Hoi-chang. Kim Jung-sool and one other recently visited the accused at the Seoul Detention Center. The United New Democratic Party also set up a team of no fewer than 15 lawyers for Kim. Oh has handed all related documents to Kim's new legal team. UNDP Attempts to Impeach Prosecutors who cleared Lee Myeong-bak (Dec 2007) Fighting broke out in South Korea's parliament on 13 Dec as lawmakers clashed over a bill to impeach prosecutors who cleared the presidential front-runner of involvement in a fraud case. A group of pro-government party lawmakers were forced to saw through iron cables to gain access to the National Assembly's main chamber after around 100 opposition politicians barricaded themselves in using tables and chairs. Television footage showed lawmakers from both sides shoving each other and exchanging punches and kicks in an attempt to occupy the podium, as the pro-government United New Democratic Party (UNDP) tried to clear it for a vote on the bill. One lawmaker was carried away on a stretcher after the fight, which left several others injured, according to Yonhap news agency. State prosecutors cleared Lee Myung-Bak of involvement in a 2001 scam allegedly perpetrated by his detained former business partner. The decision removed the last hurdle for the former construction executive and ex-mayor of Seoul, who touts a business-friendly approach to reinvigorate the economy. The UNDP has introduced a bill to impeach the prosecutors, accusing them of whitewashing Lee's involvement in the scam. The bill needs a simple majority of the 299-member legislature for approval and the UNDP has 141 seats compared to the GNP's 128. Other seats are held by minor opposition parties. (Source: Yahoo News.) Chairman of the National Assembly Lim Chae-jung, who had called the plenary session at 2:00 P.M. the same day, proposed a deadline for deliberations to the representatives of both parties right after the incidents, saying, "Please deliberate on the special prosecution bill in the Legislation and Judiciary Committee, the standing committee in charge, by noon December 17." In case the Legislation and Judiciary Committee fails to deliberate on the special prosecution bill by noon December 17, the bill will automatically be presented ex officio at the plenary session, possibly causing another confrontation between the two parties. If the impeachment bill is not transacted by 2:00 p.m. December 15, 72 hours from 2:00 p.m. December 12, when the bill was reported to the National Assembly, it will automatically be nullified based on the National Assembly Act. Meanwhile, the Democratic Labor Party and Democratic Party, which are negative about the impeachment bill but positive about the special prosecution bill, kept an eye on the situation on the plenary session floor. The Lee Myung-bak Special Prosecution Bill defines the following as issues to be investigated: candidate Lee's manipulation of BBK stock prices; ownership of land in Dogok-dong under a borrowed account; the granting of sales privileges regarding Sang-am DMC; privileges granted to the AIG group; disguised employment of his children; and tax evasion. (Source: Donga Ilbo.) Lee Agrees to Fresh BKK Probe After Video Surfaces and President Roh approves Reopening Investigation (Dec 2007) The emergence on 16 Dec of a video clip showing Lee Myung-bak boasting he founded the investment firm BBK, now at the heart of a fraud scandal, has cast fresh doubt on prosecutors' findings in the affair and opened the way for a reinvestigation. President Roh Moo-hyun was first to respond by calling for a fresh probe by prosecutors, who earlier cleared Lee of any involvement. Lee said he will accept a bill tasking a special prosecutor with investigating the stock fraud. The UNDP revealed a video clip which shows Lee saying in 2000 that he established the investment firm early that year. In a snap press conference called by co-chairmen of its campaign committee, the UNDP released the clip, which shows Lee give a lecture at a CEO program hosted by Kwangwoon University on Oct. 17, 2000. "I've recently returned home from abroad and founded an online financial firm," it shows Lee as saying. "To be specific, I founded BBK, an investment consulting firm, in January this year." Lee then adds, "Although BBK only started business early this year, profits already jumped 28.8 percent as of the end of September." (SITE NOTE: Others had said that Lee had also presented business cards listing himself as CEO of the BKK. Lee said that he over-exaggerated a bit in the speech to draw attention to the new business.) Lee told a press conference after an emergency meeting with the GNP leadership he had "nothing to be ashamed of" in the BBK scandal. "I've opposed an independent probe not because I'm afraid but because the UNDP initiated the independent counsel bill for political reasons," he said. But he added, "I can and will accept" an independent probe and asked the National Assembly to deal with the bill in accordance with the law. UNDP spokeswoman Kim Hyun-mi, however, called Lee's decision a "political show to buy time", saying the video clip cast doubt on his innocence and sparked public criticism. She said her party will handle the bill in a plenary session on 17 Dec as scheduled. (Source: Chosun Ilbo.) President Roh Moo-hyun on 16 Dec instructed Justice Minister Jung Seong-jin to use his authority so prosecutors can re-investigate the scandal "to remove public suspicion and restore public trust in the prosecution. The Justice Ministry discussed the re-investigation of the BBK scandal at an emergency leadership meeting 16 Dec. However, the Justice Ministry said on 17 Dec it had decided not to order prosecutors to reinvestigate a financial scandal allegedly involving the nation's leading presidential candidate, as political parties seek an independent probe of the case. As for the BBK bill passed by the UNDP and DP after the GNP walked out, Jung Seong-jin will purportedly point out that the bill is unconstitutional with respect to the limit on court days, and he will also likely deny Kim Kyung-joon's memo which says that prosecutors coerced him. On December 17, instead of exercising his right to direct prosecutors to reinvestigate, he approved the bill and pointed out, "The bill itself contains some problems in regard to the spirit of constitutionality, efficacy and cost." Cheong Wa Dae spokesman Cheon Ho-seon said on December 23, "The BBK bill will be passed at the cabinet council meeting as scheduled for December 26." Rebuffing calls by the Grand National Party to have him veto the legislation, President Roh Moo-hyun and his cabinet on 26 Dec endorsed the appointment of a special prosecutor to investigate President-elect Lee Myung-bak on corruption allegations, including charges he has already been cleared of by an earlier prosecution probe. The legislation, pushed by the liberal UNDP just prior to the presidential election, was designed to wrap up the probe before Lee assumed the presidency on Feb. 25. Roh will had up to 10 days to name the special prosecutor, whose investigation will last a maximum of 40 days. (SITE NOTE: Again Roh shows his failure to grasp what his mouth says. "It is necessary to recover public trust in the president-elect and the prosecution," Roh was quoted as saying. In fact, his approving the special counsel sets up President-elect Lee as being a suspect of public trust and calls the prosecutors incompetent. But again he's been doing this stuff since 2003.) The chief justice of the Supreme Court recommended two candidates to Roh on 3 Jan 2008. Two judges-turned-lawyers were named as candidates for the independent counsel to probe President-elect Lee Myung-bak's alleged involvement in a financial scam. They are Jeong Ho-young, a former Seoul High Court head, and Lee Heung-bok, former chief of the Seoul Central District Court. The Chief Justice tried to find a former prosecutor to recommend, but all refused. Six File Petition Against Special Investigation Bill (Dec 2007) Six people who are likely to be investigated due to the "BBK special prosecution bill" passed at the cabinet meeting filed a petition to the Constitutional Court Friday. They also requested an injunction until the bill is made into law. The petitioners include Kim Baek-joon, a reference of the so-called "BBK financial scandal," and a former auditor of the Seoul Metro Subway; Lee Sang-eun, a heavy stockholder of DAS, a company allegedly owned in part by the president-elect, and his brother; Kim Jae-jeong, the president-elect's brother-in-law; and three employees of the Seoul City government and the Korean German Institute of Technology prosecuted by the ruling party for the unfair sale of Digital Media Center (DMC). On their behalf, two lawyers, Song Jeong-ho, a former Justice Minister, and Lee Seok-yeon filed a petition that claimed, "The BBK special prosecution bill infringes on the equality stipulated by the Constitution, personal liberty, warrants, the right to have a fair trial, and the benefit of doubt." The petitioners pointed out that the bill is the first ever law that targets individuals and disagrees with generality and abstraction of laws, which limits the lawmaking power of the National Assembly. Additionally, they argued that the requirement that mandates references to be subject to investigation is also against the warrant system on the Constitution, and that the bill was not justice because Lee won the elections in a landslide victory, meaning that the public trusts prosecutors. Lawyer Lee said, "As the petitioners have already been prosecuted or investigated as references by prosecutors, and are likely to be subject to special investigation, the basic requirements of directness, self-referentiality, and presentation are met." Jang Seok-hwa, a lawyer, petitioned against the bill and requested an injunction on December 24, but some experts point out that it is hard to recognize any request eligibility because the petitioners are not the subjects of the bill. The Constitutional Court rejected his plea on 31 Dec stating that his rights would not be violated by the action. However, the other six petitioners injunction was still under consideration. The Constitutional Court on 3 Jan promised to "expedite" their decision on the petition. If they decide in favor of the petitioners, the investigation will stop immediately. The Justice Ministry submitted a report to the Constitutional Court arguing that the independent counsel law is unconstitutional. "At the cabinet meeting on Dec. 26, Justice Minister Chung Soung-jin pointed out the unconstitutionality of the law governing the probe," a senior ministry official said on 6 Jan. The Constitutional Court on 10 Jan okayed the controversial law calling for an independent investigation of fraud allegations against President-elect Lee Myung-bak, but ruled as unconstitutional a clause authorizing a special prosecutor to call witnesses without a warrant. The ruling is expected to significantly limit the scope of the probe. The independent counsel has to produce results before Lee's Feb. 25 inauguration without questioning key persons involved if they ignore summons. GNP Submits Revised BBK Bill (Dec 2007) On 31 Dec the GNP has submitted a revision to the bill seeking an independent counsel to look into the BBK stock scandal. The bill, which was proposed by the rival UNDP, aimed to determine whether President-elect Lee Myung-bak had any link to the troubled BBK investment firm. GNP Floor Leader Ahn Sang-soo blasted the existing bill, saying it crossed legislative boundaries. He added that it went against the principle of separation of powers, noting that only the chief justice of the Supreme Court had the right to appoint an independent counsel. In addition, Ahn said the current bill allowed detainment without a warrant and violated the principle of presumed innocence. (SITE NOTE: The chief justice of the Supreme Court reluctantly -- as it is normally the Ministry of Justice's job -- recommended two candidates to Roh by 3 Jan 2008 simply because it was part of the bill. Chung Ho-young (60), former chief of the Seoul High Court, was chosen as the special counsel tasked with probing president-elect. Chung served as a member of the National Election Commission from 2005 to 2006. He passed the bar exam in 1970, but has never worked as a prosecutor.The special counsel would prepare for seven days before starting the investigation. He would have to complete the investigation in 30 days, to be extended for another 10 days.) The revised bill restricts charges involving Lee to two counts: one, ex-BBK chief Kim Kyung-joon's alleged stock price manipulation through the BBK investment firm and its spinoff Optional Ventures; and, two, Lee's alleged money laundering via overseas funds. The GNP will also requested that the Constitutional Court conduct a jurisdictional review on the counsel bill. It called for nullification of the bill. Lee probe in high gear, raids target Seoul land deal (Jan 2008) In a search for evidence linked to President-elect Lee Myung-bak's alleged abuse of power as Seoul mayor, investigators led by an independent prosecutor raided five offices and homes on 18 Jan 2008. They were searching for proof that Lee knowingly awarded a lucrative real estate development project to an unfit company in 2002. Lee is accused of having given preference to the company, named Handok, in the sale of a plot at the Digital Media Center under development in Sangam-dong while serving as the mayor in 2002. Handok operates the Korean German Institute of Technology, "Investigators raided the offices of the Korean German Industrial Park Co. and Jinmyung Jungjin Academic Foundation and three homes of related officials," Kim Hak-geun, an assistant prosecutor on Independent Counsel Chung Ho-young's team, said yesterday after the sweeps. "We confiscated 25 boxes of documents. Three digital data investigators also copied files from computer servers of the two companies." Lee was accused of abusing his power as Seoul mayor by giving favorable treatment to the Korean German Industrial Park, which won a project in western Seoul in December 2002 as part of the city government's Sangam Digital Media City development. The company was given the right to develop a core part of the site by submitting a plan to invite research institutes and companies from Germany to open branches on the site. The company obtained loans by using the land as a guarantee. Deviating from the original investment plan, Korean German Industrial Park built an office-residential building on the site and earned more than 600 billion won ($636 million) by selling the units. Questioning the legitimacy of the business, the United New Democratic Party filed petitions with the prosecution in October to investigate the firm's head, Yoon Yeu-dug, and five city officials. The Seoul Western District Prosecutors' Office handed over its investigation findings to the independent counsel, whose probe is to end before Lee's inauguration on Feb. 25. "At the time, the company had no record of attracting foreign investments. The balance in its corporate account was only 15 won," the liberal party has claimed. The UNDP said building a commercial building was a fraud because the land was to be used for research and development. The party has also accused Korean German Industrial Park of raising slush funds in the course of donating 30 billion won to Jinmyung Jungjin Academic Foundation. The company denied the allegations. (Source: Joongang Ilbo.) U.S. Court Clears Lee of Embezzlement and Lee`s business partner loses damages suit (Feb 2008) A U.S. federal court on 6 Feb ordered President-elect Lee Myung-baks former business partner Kim Kyung-joon and his family to pay about $50 million in damages to investors in his venture capital firm because of his stock prices manipulation and embezzlement. The court in Los Angeles ruled on a damages lawsuit by minor investors in Optional Capital. The action was filed in June 2004 against Kim, his wife and his sister. They claim that the three colluded to manipulate the stock prices of Optional Capital, and misappropriated company funds amounting to 38 billion won ($40 million) in 2001. Kim was indicted late last year on fraud charges. In his first court hearing in Seoul on Jan. 14, he denied all the charges. He said that the stock prices naturally increased, and that he did not embezzle company funds, as most of the money was sent back to the investors. In addition, the U.S. court has ruled that president-elect Lee Myung-bak had no hand in embezzlement by his ex-business partner Kim Kyung-joon. The Los Angeles Federal Court is also overseeing a civil suit against Kim filed by Korean company Optional Capital, the victim of the embezzlement. The court made the ruling on a so-called third-party defendant suit in which Kim asked the court to confirm the responsibility of the president elect in the embezzlement case, as he was also involved in the management of the company. The case is an offshoot of a compensation suit against Kim, his wife Lee Bo-ra and his older sister Erica Kim by Optional Capital, which is seeking US$30 million. (Source: Chosun Ilbo and Korea Herald.) Investigators Grill Lee (Feb 2008) President-elect Lee Myung-bak was grilled by investigators after they had looked into his alleged involvement in fraud and business irregularities at a downtown Seoul hotel on 17 Feb. The Constitutional Court last month approved independent counsel's Chung Ho-young to investigate a number of suspicions surrounding Lee that were raised during the presidential campaign, including his alleged involvement in rigging of stock prices of the BBK investment consultancy. Chung's team is also trying to confirm whether Lee deliberately failed to disclose some of his assets, including an apartment in southern Seoul, whose ownership is yet unknown, thus violating the law regarding civil servants' ethics. Lee was questioned for about nine hours until midnight at his temporary office at Lotte Hotel with investigators focusing on a video-recorded speech at Kwangwoon University in 2000 where he appears to be taking credit for the establishment of the BBK. Chung was not present during Lee's questioning, officials said. The investigators are planning to report its findings on 22 Feb, three days before Lee takes office. The independent counsel has been speeding up its probe of Lee as their mandate of 40 days expires on 23 Feb. However, the team was apparently reluctant to summon Lee to their office in Yoksam-dong, southern Seoul, with his inauguration ceremony just a week away. (Source: Korea Times.) The team apparently came to Lee instead of summoning him because they failed to obtain decisive evidence that could reverse the results of a previous investigation by prosecutors, which cleared Lee of all charges. The special counsel has been investigating for 34 days since it was launched on 15 Jan. He has apparently concluded that Lee had no hand in the management of BBK and a stock-price fixing scheme by his ex-business partner Kim Kyung-joon. He also seems persuaded that there was no favoritism in the DMC project. Questioning Lee's elder brother Lee Sang-eun also provided no evidence that Lee was the actual owner of the land. Prosecutors in a previous probe concluded ambiguously that the land was owned by a "third party" other than Sang-eun and his brother in law, who appear on the documents, but added there was no evidence that was the president elect. The special probe is therefore likely again to clear Lee of the charges when results are announced on 22 or 23 Feb. (Source: Chosun Ilbo.) GAME OVER: Special prosecutor clears President-elect Lee Myung-bak (Feb 200 7) A special prosecutor cleared President-elect Lee Myung-bak of corruption allegations on Thursday, freeing the CEO-turned politician to push ahead with his promised economic reforms. Special prosecutor Chung Ho-young concluded that a slew of allegations raised by Lee's opponents, including Lee's role in a 2001 stock manipulation scam, were groundless. "The president-elect was found to have no involvement in the stock manipulation," Chung said in a nationally televised press conference. The exoneration should enable Lee, set to take office on 25 Feb, to push ahead with his key campaign pledges including a controversial canal project and government reform. It will also give an edge to Lee's conservative Grand National Party in the April parliamentary election race. "It's a good thing that all the allegations were cleared away again and that the new government can have a fresh beginning," Lee was quoted as saying by his spokesman, Joo Ho-young. "I'd like to return my gratitude by serving the people with a sincere heart and dedicating myself to reviving the national economy." The independent probe, legislated by liberals affiliated with outgoing President Roh Moo-hyun, kicked off after Lee's landslide election victory in December. Lee had been cleared of the charges in a pre-election probe, but the opponents said the investigation was "biased." Few expected, however, that the special prosecutor would override the previous findings to declare Lee guilty. He had only 40 days for the politically sensitive investigation, compared to the 105-day mandate given to another special prosecutor now probing the Samsung Group corruption scandal. Also, Chung had no authority to force witnesses to obey summonses, a power usually given to special prosecutors working on complex issues. Under such constraints, the investigators did not question key witnesses and conducted just one face-to-face session with Lee. At stake in the Lee probe were whether Lee collaborated in the share rigging scam using an investment firm called "BBK"; whether he lied about his wealth; whether the Seoul city government, under Lee's directive, gave a lucrative land deal to an unqualified firm; and whether prosecutors acted properly in vindicating Lee in their earlier probe. The special prosecutor reached the same conclusions as the earlier investigators. They indicted Lee's former business partner, Kim Kyung-joon, for stock manipulation, embezzlement of 38 billion won (US$42 million) and forgery. Lee and Kim had jointly set up another Internet investment firm a year before the BBK fraud took place. "The crime was committed by Kim Kyung-joon alone. There's no evidence that the president-elect was involved in the embezzlement or shared in the proceeds," Chung said. Early this month, a U.S. court ordered Kim, a Korean-American now being tried in Seoul for the BBK fraud, to pay a minimum of US$50 million in compensation to his company's stockholders for their losses resulting from the BBK fraud. Independent Counsel Chung Ho-young announced that his team found the president not guilty of real estate speculation, fraud and stock manipulation, among other accusations. With a 38-day probe ordered by the National Assembly, Chung's team found no evidence to link Lee to massive investment fraud involving BBK. The special team also cleared Lee of the accusation that he was the owner of DAS, an auto parts company that made a large investment in BBK. Lee was also cleared of allegations that he had hidden various assets under other people's names, including suspicion that he was the real owner of an expensive piece of land in southern Seoul, and that he benefited from its sale. Questions about Lee's past behavior did not prevent his landslide election victory. With a promise to jumpstart the country's economy, the former Seoul mayor and former CEO of Hyundai Construction & Engineering promised a break with Roh's liberal government that had focused on reconciliation with North Korea and resolving historical issues. The liberals had hoped that the investigation into Lee's past would give them an advantage in the April parliamentary elections. That now looks unlikely. (Source: Yonhap News.) NEW GAME: Payback. Lawmaker indicted as prosecutors target president's accusers (Feb 2008) Days after the Independent Counsel team cleared President Lee Myung-bak of a series of corruption allegations, the Seoul Central District Prosecutors' Office has taken aim at Lee's political rivals from the United Democratic Party. The prosecutors' office announced on 24 Feb that Chung Bong-ju, a member of the United Democratic Party, has been indicted without detention on 23 Feb for election law violations during the presidential campaign. Chung claimed that Lee had colluded with his one-time business partner, Kim Kyung-joon, in an investment fraud involving the failed financial firm BBK. "Chung was charged after he circulated allegations that Lee was involved in financial scandals, including stock price manipulation and embezzlement," said an official on the case who declined to be named. Prosecutors also said they will decide soon whether to punish other members of the UDP. The list includes a former candidate for the presidency, Chung Dong-young, and other incumbent National Assembly representatives, Park Young-sun and Suh Hae-suk, for giving false information to voters about Lee Myung-bak. The Grand National Party filed several lawsuits against them last year. "We demanded they be present at the prosecutors' office, but their lawyers responded that they will send a written statement instead of attending," said an official who declined to be named. "After reviewing the statements quickly, we will make a final decision on punishing them." If the UDP members are convicted, they can be sentenced to a maximum seven years imprisonment and fined up to 5 million won ($5,271). Also, they can be discharged from their positions and banned from running in the legislative elections on April 9. (Source: Joongang Ilbo.) NEW GAME: Payback. Justice Ministry Want to Know Who Saw Kim in US (Feb 2008) The Justice Ministry has received the U.S. prison interview record of Kim Kyung-joon, the central figure in the BBK stock fraud scandal, from the U.S. Justice Department The ministry said yesterday that senior prosecutor Choi Jae-kyung of the Seoul District Prosecutors` Office is investigating the document. Whom Kim met in U.S. federal prison before his extradition to Korea is on the record. A political bombshell is expected if Korean intelligence officials or politicians are mentioned. After the record is analyzed, Kim will be grilled on why he gave up fighting his extradition to Korea. He has refused to appear for questioning, citing his right to silence. "I want the independent prosecutor team, not the prosecution, to investigate me." In addition, prosecutors have summoned a "Shin" who stayed in the same prison as Kim and people close to Shin. Shin said, "I heard Kim is getting help from an unknown official in an executive position who was sent to the Korean consulate-general in Los Angeles, and I know that the official's successor contacted Erika Kim, Kim Kyung-joon's sister." The National Intelligence Service, however, denied the allegation, saying, "We also conducted our own investigation and none of our officials were involved." (Source: Donga Ilbo.) Prosecutors have evidence that the return of Kim Kyung-joon on the eve of the presidential election was planned by Kim's sister, politicians and spy agency officials, a source said on 27 Feb. According to a source with the Seoul Central District Prosecutors' Office, Kim's elder sister Erica Kim, 44, a Korean-American lawyer, played a key role in her brother's return to face criminal charges here one month before the December election. ''We are investigating an allegation that Erica Kim contacted politicians on behalf of her brother, who was detained in the U.S., to arrange his return to Korea,'' the source said. ''We have circumstantial evidence that Erica Kim was in contact with politicians and officials of the National Intelligence Service last year. We are reviewing a plan to seek her extradition to Korea to question her directly.'' According to the source, a cellmate of Kim's in the United States made the allegations. ''Kim told me that two or three National Intelligence Service officials were helping him,'' the man was quoted as saying. ''Kim even gave me their names.'' (Source: Joongang Ilbo.) BBK's Kim accused of trying to pay off witness (Mar 2008) A former employee of Kim Kyung-joon, the one-time business partner of President Lee Myung-bak currently on trial for fraud related to the failed BBK financial company, said yesterday his boss had attempted to pay him in return for favorable testimony in a U.S. court. The 33-year-old man, who once worked at Kim's companies, BBK and Optional Ventures, appeared yesterday as a prosecution witness at Kim's trial session in the Seoul Central District Court. The man said he was offered $1 million in return for his testimony but refused to do so. ''In 2004, the boyfriend of Erica Kim [Kim's older sister] said I would be given $1 million if I testified before a U.S. court in favor of Kim, but I rejected the offer,'' he said. ''Offering me such a large sum means that I would have to commit perjury, and I thought the request was suspicious.'' Before Kim's extradition to Korea in November last year, the witness was convicted of forging U.S. passports and business documents used to establish a corporation in September 2003. He was ordered to serve one year in prison. Asked by the prosecution if he had rejected the offer because he did not want to be involved with Kim any more, the witness said, "Yes." He said the forgery had been ordered by Kim. ''Names of professors from a U.S. university where I graduated and names of actors who appeared in a movie called ''Boiler Room'' were used to forge the documents,'' the witness said. Kim had earlier said that Lee was the actual owner of BBK and the beneficiary of the fraud, but prosecutors have fully cleared Lee of any involvement in the scandal. Kim faces a series of stock manipulation, forgery and embezzlement charges. He has pleaded not guilty and claimed prosecutors are conducting a ''political probe.'' Prosecutors suspected in February that the National Intelligence Service, during the last months of the Roh Moo-hyun administration, might have been involved in the return of Kim to Korea in order to discredit Lee ahead of the election. On Friday, a cellmate of Kim's from a Los Angeles detention facility is expected to testify about the allegation that Kim's sister, politicians and spy agency officials planned Kim's return, which dogged Lee until just before his inauguration on Feb. 25. (Source: Joongang Ilbo.) BBK Kim's cellmate fingers UNDP (Mar 2008) A lawyer affiliated with the United New Democratic Party attempted to bribe a convict on the eve of the December presidential election in return for publicly linking Lee Myung-bak to a massive investment fraud scandal, according to a trial witness on 15 Mar 2008. Kim Kyung-joon, a former business partner of Lee, is on trial. He is accused of stock price manipulation, embezzlement and document forgery. Kim, who operated an investment company with Lee in 2000, fled to the United States in 2001. He was arrested by the FBI in 2004 and extradited to Korea on Nov. 16, 2007. Kim argued that Lee was the actual beneficiary and mastermind of the fraud. The man, only identified as Shin, 50, was Kim's cellmate for one year while the two were jailed in Los Angeles. "I was extradited to Korea in November last year before Kim arrived here to face charges," Shin said. "I was jailed in Daejeon Prison, and a lawyer from the United New Dem |
