Denial of Arrest Warrant and Separate Prosecution
For North Korea Remittance and Perjury Coaching
Remaining Charges Under Supplementary Investigation
The prosecution has prioritized indicting Lee Jae-myung, leader of the Democratic Party of Korea, on charges of breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes in connection with the 'Baekhyeon-dong development preferential treatment' case. This comes just two weeks after the court dismissed the arrest warrant on the 27th of last month.
Previously, the prosecution had requested arrest warrants for Lee regarding three cases: the Baekhyeon-dong development preferential treatment, illegal remittances to North Korea by Ssangbangwool Group, and witness tampering. Among these, only the charges related to the Baekhyeon-dong development preferential treatment allegations were separated and indicted first. Additional investigations are expected to continue for the remaining charges.
The Anti-Corruption Investigation Division 3 of the Seoul Central District Prosecutors' Office (Chief Prosecutor Kim Yong-sik) indicted Lee and Jeong Jin-sang, former Political Coordination Officer of the Democratic Party leader’s office, without detention on the morning of the 12th regarding the Baekhyeon-dong case.
Lee Jae-myung, leader of the Democratic Party of Korea, who has been indicted on charges related to preferential treatment in the Baekhyun-dong development project and involvement in Ssangbangwool's North Korea remittance allegations, appeared at the pre-trial detention hearing at the Seoul Central District Court in Seocho-gu, Seoul, on the 26th of last month. Photo by Hyunmin Kim kimhyun81@
Lee is accused of playing a leading role in granting various preferential treatments to private developers by unusually upgrading the land use designation of the former Korea Food Research Institute site in Baekhyeon-dong, Bundang-gu, Seongnam City, from natural and conservation green space to quasi-residential area in four stages during his tenure as mayor of Seongnam from 2014 to 2015.
From April 2014 to February 2017, during the Baekhyeon-dong project, Lee allegedly conspired with former officer Jeong to exclude Seongnam Urban Development Corporation from the project at the request of broker Kim In-seop, former CEO of Korea Housing Technology. They allowed the private developer Jeong Ba-ul, CEO of Asia Developer, to proceed with the Baekhyeon-dong development project solely through Seongnam R&D PFV. The prosecution found that they provided multiple preferential treatments, including upgrading the land use designation for apartment construction, changing the donation targets, reducing the proportion of rental apartments, and approving illegal retaining wall installations. In this process, Jeong reportedly gained profits worth approximately 135.6 billion KRW through sole implementation, Kim received 7.7 billion KRW as a bribe from Jeong, and Seongnam Urban Development Corporation suffered losses estimated at a minimum of 20 billion KRW, according to the prosecution’s assessment.
With this indictment, Lee is expected to face trial for the Baekhyeon-dong case alongside the Daejang-dong and Wirye New Town development corruption cases before the same court. A prosecution official stated, "The Baekhyeon-dong preferential treatment case and the Daejang-dong and Wirye development corruption cases all involve crimes committed during Lee’s tenure as mayor of Seongnam, share a similar structure of funneling development profits to developers and brokers, involve the same defendants, and the first hearing for the Daejang-dong and Wirye cases was held on the 6th, marking the early stage of the trial. Therefore, we separated and prioritized the indictment and applied for consolidation."
Meanwhile, the prosecution is carefully reviewing the reasons for the dismissal of Lee’s arrest warrant while supplementing investigations into witness tampering and remittances to North Korea. After completing the investigation, the prosecution will decide whether to indict Lee without detention or to reapply for an arrest warrant. A conclusion is expected within this month. A prosecution official said, "We plan to promptly handle the remaining witness tampering and remittance cases after reviewing the relevant legal grounds and the necessity for supplementary investigations."
Previously, Chief Judge Yoo Chang-hoon, who presided over the substantive hearing of Lee’s arrest warrant, stated, "Regarding the Baekhyeon-dong development project, there is considerable suspicion of the suspect’s involvement in excluding the corporation from the project based on the suspect’s position, related approval documents, and testimonies of involved parties," but added, "There is a lack of direct evidence concerning this." However, regarding the evidence, he suggested that "Considering the human and material evidence secured so far, it is difficult to see a risk of evidence destruction," implying that some evidence has been secured.
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