Prosecutors Indict Two Close Associates of Kim Man-bae for Concealing Profits from Daejang-dong Project (Comprehensive)

Lee Han-sung, CEO of Cheonhwa Dongin No. 1
[Photo by Yonhap News]

[Asia Economy Reporter Kim Hyung-min] The prosecution has indicted close associates of Kim Man-bae, the major shareholder of Hwacheon Daeyu Asset Management, on charges of concealing profits from the Daejang-dong development project.

The Anti-Corruption Investigation Division 1 of the Seoul Central District Prosecutors' Office (Chief Prosecutor Eom Hee-jun) on the 2nd arrested and indicted Lee Han-seong, co-CEO of Hwacheon Daeyu, and Choi Woo-hyang (former vice chairman of Ssangbangwool Group), a director, for violating the Act on the Regulation of Concealment of Criminal Proceeds.

They are accused of withdrawing 24.5 billion KRW in high-denomination checks several times from November 2021 to November last year under Kim's instructions, then reissuing them as hundreds of small-denomination checks and hiding them in various places such as loan safes.

Choi is also suspected of receiving 3 billion KRW from Kim in October 2021, which Kim received as dividends from Hwacheon Daeyu, in the form of a loan and concealing it.

Investigations revealed that tens of billions of KRW from the withdrawn checks were used to purchase land under Kim's name or aliases. They reportedly bought land around Ip-buk-dong, Gwonseon-gu, Suwon City, intended for the creation of a 4th industrial technology research complex, but resold it during the investigation. Additionally, when the prosecution leadership changed in May last year and the investigation team was replaced, effectively restarting the reinvestigation, they monitored the investigation closely and moved the hidden funds accordingly.

During the investigation, the prosecution seized physical checks worth approximately 14.8 billion KRW that they had hidden.

Lee worked as an aide to Lee Hwa-young, former Peace Deputy Governor of Gyeonggi Province and a close associate of Lee Jae-myung, leader of the Democratic Party of Korea, during his time as a member of the National Assembly. At the request of Kim, a junior alumnus from Sungkyunkwan University, Lee joined Hwacheon Daeyu in 2017 and served as the 'treasurer,' managing Kim's bank accounts and seals.

Kim Man-bae [Image source=Yonhap News]

Choi, a former gangster and a 20-year close associate of Kim, managed Hwacheon Daeyu's finances. When Kim's first arrest warrant request was dismissed in October 2021, Choi came out to greet him wearing a motorcycle helmet in front of Seoul Detention Center.

The prosecution believes that Kim promised to hand over 42.8 billion KRW from the profits of Cheonhwa-dongin No. 1 to Jeong Jin-sang, former Political Coordination Officer of the Democratic Party leader's office; Kim Yong, former deputy director of the Democratic Research Institute; and Yoo Dong-gyu, former planning director of Seongnam Urban Development Corporation.

However, Kim maintains that the '42.8 billion KRW promise' was merely a 'placation' with no real intention to pay, insisting that Cheonhwa-dongin No. 1 belongs to him. The prosecution plans to continue questioning Kim as soon as his health recovers after his recent suicide attempt on the 14th of last month. Kim, who had been receiving inpatient treatment at Ajou University Hospital, was discharged on the 27th of last month and is currently at home.