The Corruption Investigation Office Tracks Funds in 'Police Executive Bribery' Case... Money Laundering Disguised as Loans

The High-ranking Officials' Crime Investigation Unit (HOCIU) detected signs of money laundering and embezzlement by Lee Sang-young, chairman of Daewoo Industrial Development, who was identified as a bribe giver during the investigation of bribery allegations against a current police executive.

[Photo by the High-ranking Officials' Crime Investigation Agency]

According to the legal community on the 8th, HOCIU recently summoned Mr. A, an acquaintance of Chairman Lee, and obtained a statement indicating that he received about 100 million won from Chairman Lee under the pretext of a loan. It was investigated that Mr. A laundered the money to avoid fund tracing, converted it into cash, and returned it to Chairman Lee.

HOCIU suspects that Chairman Lee handed over the cash he received in this way as a bribe to the police executive. The investigation is also considering the possibility that Chairman Lee embezzled company funds during the money laundering process and is probing related suspicions.

Chairman Lee is accused of delivering 120 million won in cash and goods to Police Superintendent Kim, who was working at the Gangwon Provincial Police Agency last year, along with a request to halt an investigation. At that time, Chairman Lee was under investigation by the Financial Crime Investigation Unit of the Seoul Metropolitan Police Agency for allegations including accounting fraud and breach of trust at Daewoo Industrial Development.

Mr. A is also suspected of instructing those involved in the money laundering process to delete or destroy related evidence and coaching false statements. It is known that he changed his previous position during a recent investigation and gave statements unfavorable to Chairman Lee.

HOCIU planned to summon Mr. A again for further investigation the day before, but the plan was thwarted by the intervention of Mr. B, the attorney representing Chairman Lee. Before the investigation, Attorney B called the HOCIU investigation office to notify that he had been appointed as Mr. A’s legal counsel and canceled the investigation schedule.

HOCIU argued that Attorney B’s simultaneous representation of Chairman Lee and Mr. A, whose interests conflict, violates Article 24 (Duty to Maintain Dignity, etc.) of the Attorney-at-Law Act and Article 22 (Restrictions on Acceptance of Cases) of the Attorney Ethics Charter. They also raised concerns about the risk of evidence destruction or manipulation of statements. Additionally, they claimed that Attorney B’s unilateral cancellation of the investigation schedule caused changes in the investigation timetable of related parties, thereby hindering the investigation.

On the same day, HOCIU applied to the Korean Bar Association to initiate disciplinary action against Attorney B. If any criminal acts such as attempts to destroy or manipulate evidence by the legal counsel are discovered during the investigation, HOCIU plans to request prosecution or notify relevant authorities.