Special Investigation Unit Applies for Arrest Warrant for Former LH Vice President on Suspicion of Speculation and Bribery

LH Former and Current Top Executives
Former Happiness Agency Chief Under Supplementary Investigation for a Month
Dispute Over Application of 'Anti-Corruption Act'

[Asia Economy Reporter Lee Gwan-joo] The government joint special investigation headquarters (Special Investigation Headquarters), which is investigating real estate speculation allegations, has applied for an arrest warrant for the former vice president of Korea Land and Housing Corporation (LH).

A representative of the Special Investigation Headquarters told reporters on the 3rd, "We have applied for a pre-arrest warrant for former LH vice president Mr. A." The pretrial detention hearing for Mr. A is scheduled to be held at 11 a.m. on the 4th at the Suwon District Court Seongnam Branch.

Mr. A, who retired as LH vice president in 2016, is the highest-ranking official among current and former LH executives suspected of speculation. In 2017, Mr. A purchased land and a four-story building in Jungang-dong, Seongnam-si, Gyeonggi Province, and sold it in June last year. After Mr. A purchased this land, it was included in the Seongnam City housing redevelopment maintenance project. The police believe Mr. A used non-public information for speculation.

Mr. A is also reportedly under suspicion of receiving money and valuables in exchange for favors related to development projects, including the 3rd New Town. The investigation into Mr. A is being conducted directly by the Serious Crime Investigation Division of the National Police Agency. Earlier, on April 13, the police raided the LH headquarters, Seongnam City Hall, and Mr. A’s residence to secure related materials and have been accelerating the investigation.

Regarding former and current public officials under investigation for speculation allegations, the highest-ranking official is former Administrator of the Administrative City Construction Agency (vice-ministerial level) Mr. B, who has been undergoing supplementary investigation for over a month. The Special Investigation Headquarters applied for an arrest warrant for Mr. B on April 30, but additional investigations are ongoing following the prosecution’s request for supplementary investigation.

However, it is reported that there is a disagreement between the prosecution and police regarding Mr. B’s detention. The key issue is whether the Anti-Corruption and Civil Rights Commission Act can be applied to Mr. B. Mr. B retired as Administrator of the Happy City Agency in July 2017 and in November of the same year purchased land in Bongam-ri, Yeonseo-myeon, Sejong City, along with a lightweight steel structure built on the site. Since the nearby Wachon and Budong-ri areas are scheduled to be designated as candidates for the Smart National Industrial Complex, suspicions have been raised that he could benefit from peripheral development.

The Special Investigation Headquarters believes Mr. B acquired internal information during his tenure as Administrator of the Happy City Agency and purchased the land after retirement. The issue is that the current Anti-Corruption and Civil Rights Commission Act explicitly prohibits "public officials from using confidential information obtained through their duties," and whether this applies to retirees is under debate. A representative of the Special Investigation Headquarters explained, "We received an authoritative interpretation from the Anti-Corruption and Civil Rights Commission that the relevant provision can be applied even if the land was purchased after retirement using information obtained during tenure," adding, "We are checking whether there are related precedents." It is known that Mr. B has denied acquiring internal information during his tenure in his statements.