‘Corporate Investigation Expert’ Lee Won-seok Nominated as Prosecutor General Candidate... Business Community on Alert

Lee Won-seok, the Deputy Prosecutor General of the Supreme Prosecutors' Office, who was nominated as the first Prosecutor General candidate under President Yoon Suk-yeol's administration, is expressing his thoughts on the 18th at the Supreme Prosecutors' Office in Seocho-gu, Seoul. Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporter Kim Hyung-min] Candidate for Prosecutor General Lee Won-seok (age 53, Judicial Research and Training Institute class 27) is well recognized as an expert in 'corporate investigations.'

The embezzlement case of Dam Cheol-gon, chairman of Orion, from 2010 to 2011 is the most frequently mentioned. At that time, Candidate Lee was at the forefront of the investigation as part of the Financial and Tax Investigation Division 3 of the Seoul Central District Prosecutors' Office. The case involved Dam Cheol-gon, then chairman of Orion Group, purchasing expensive artworks with affiliate company funds and misappropriating corporate funds by disguising payments as salaries to executives of shell affiliates, embezzling a total of 22.6 billion KRW and committing breach of trust amounting to 7.4 billion KRW. Until then, corporate investigations were conducted in a 'blanket' manner, thoroughly searching all affiliates, but Candidate Lee and his investigation team did not follow this approach. They focused intensively only on necessary points based on reports filed by the National Tax Service. It was also the first time that the charge of 'embezzlement' was applied for purchasing and installing expensive artworks with corporate funds. Dam was arrested and indicted in June 2011, and in April 2013, the Supreme Court confirmed a sentence of three years imprisonment with five years probation. This case is still regarded in the legal community as having brought a 'new wind' from the investigation process to the application of charges. In addition, Candidate Lee investigated corporate corruption cases including the 2005 Samsung Everland convertible bond case, as well as cases involving New Core, Haitai, Sungwon, Sun & Moon, and Seohae General Construction.

Following his nomination as Prosecutor General candidate, on the 19th, the business and legal communities are paying close attention and are tense about whether there will be changes in future corporate investigations by the prosecution. After his nomination the previous day, Candidate Lee emphasized, "The reason for the existence of the prosecution is to protect the basic rights such as the life, physical safety, and property of the people." This is interpreted as also signaling that economic crimes infringing on the property rights of the people will not be tolerated. At the end of 2011, he received the 'Economic Inspection Award' from a domestic media outlet and expressed his belief that "Although there are complaints that investigations related to economic crimes make corporate management difficult, efforts to soundly develop Korean capitalism are absolutely necessary."

Currently, the prosecution is investigating cases involving multiple companies. A representative case is the embezzlement and breach of trust involving Ssangbangwool Group, which is being examined by the Suwon District Prosecutors' Office. It concerns suspicious transactions worth tens of billions of won that occurred during the issuance and resale of convertible bonds within the group from 2020 to 2021. In November last year, the Financial Intelligence Unit (FIU) confirmed this and notified the Supreme Prosecutors' Office, which then assigned the case to the Suwon District Prosecutors' Office. There are also confirmed circumstances of leaks of investigation secrets related to this case, and investigations are ongoing. Regarding this, Candidate Lee instructed, "We must thoroughly investigate and uncover the truth."