Suspected of 'Son's 5 Billion Won Retirement Payoff,' Kwak Sang-do Faces Imprisonment Decision Today

Former Assemblyman Gwak Sang-do Photo by Yonhap News

[Asia Economy Reporter Kim Daehyun] The pre-trial detention hearing (warrant review) for former National Assembly member Kwak Sang-do, who is suspected of receiving a 5 billion KRW retirement payment for his son, is set to take place.

At 10:30 a.m. on the 1st, Judge Seo Bomin, in charge of warrants at the Seoul Central District Court, is scheduled to conduct Kwak's detention hearing. The decision on whether to detain him is expected to be made either later that afternoon or in the early hours of the 2nd.

Kwak is accused of assisting Kim Man-bae, the major shareholder of Hwacheon Daeyu Asset Management (Hwacheon Daeyu), in forming a consortium with Hana Bank related to the Daejang-dong development project, and in return, receiving approximately 2.5 billion KRW in retirement payments and other fees through his son. Although the total retirement payment was 5 billion KRW, the warrant's criminal facts reportedly state the net amount received after taxes, which is 2.5 billion KRW.

The special investigation team at the Seoul Central District Prosecutors' Office, led by Deputy Chief Prosecutor Kim Tae-hoon, investigating the Daejang-dong lobbying allegations, previously summoned Kwak's son, Byung-chae, twice for questioning and recently conducted raids on Kwak's residence, office, and Hana Bank's headquarters. Subsequently, on the 27th of last month, Kwak was summoned for a closed-door investigation, and two days later, a detention warrant was requested on charges of bribery under the Specific Economic Crimes Act.

Under the Specific Economic Crimes Act, bribery by mediation is established when a third party mediates financial company business and receives or demands money or valuables. Initially, it was expected that Kwak would be charged with bribery in connection with the Daejang-dong scandal, but since the third-party bribery offense applies only when a public official receives a bribe related to their official duties, and the exercise of influence concerning Hana Bank is unrelated to official duties, the investigation has shifted in this direction.

Meanwhile, former lawmaker Kwak has denied the allegations, stating, "I have not been involved in any matters related to Hwacheon Daeyu, nor have I been involved in the Daejang-dong development project."