Gong Young-woon, Controversy Over Child Housing Gift... Lee Jun-seok Asks, "Is It a Discharge Gift?"

Seongsu-dong House Gifted While Son Serving in Military
Timing Raises Suspicions of 'Speculative Housing Purchase'
Candidate Gong: "Not Meeting Public Expectations but Legal"
"Is Paying 40 Million Won Tax on 1.5 Billion Won Appropriate?" Lee Jun-seok Strikes Back

Gong Yeong-woon, the Democratic Party of Korea candidate for Hwaseong-si Eul in Gyeonggi Province, is embroiled in controversy after it was revealed that he gifted a high-priced house located in Seongsu-dong, Seoul, to his son who was serving in the military at the time, just before the area was designated as a land transaction permission zone. Lee Jun-seok, leader of the Reform New Party and a competitor in the same electoral district, criticized this as a "dad chance," while candidate Gong denied allegations of speculative housing purchases.

According to media and political circles on the 28th, Gong Yeong-woon purchased a multi-family house located in Seongsu-dong, Seongdong-gu, Seoul, in June 2017, and gifted the house to his son in April 2021, just before the area was designated as a land transaction permission zone. At that time, his son was 22 years old and serving in the military. The house price reportedly rose from 1.18 billion KRW at the time of purchase to around 2.8 to 3 billion KRW currently.

Former Hyundai Motor Company President Gong Yeong-un, a recruited talent of the Democratic Party of Korea, clenches his fist on the afternoon of the 6th at Dongtan Lake Park in Hwaseong-si, Gyeonggi-do, ahead of his announcement to run for the 22nd National Assembly election in Hwaseong.
[Image source=Yonhap News]

When an area is designated as a land transaction permission zone, transactions such as sales and gifts are only possible if the "actual residence requirement" is met. Because of this, suspicions of a loophole gift or speculation were raised regarding the timing of Gong’s gift to his son, his status as a multi-homeowner, and the purchase of the house before the price surge. Lee Jun-seok also claimed that Gong might have used insider information related to the "Sampyo Remicon site relocation agreement."

Candidate Gong acknowledged the purchase and gift, stating, "I bought a house in the Seongsu-dong redevelopment area in 2017 while serving as vice president of Hyundai Motor Company, intending to live there after retirement. Later, I thought I should give a house to my child to prepare for marriage and other matters, so I decided to gift it."

He accepted that "gifting a house to a child serving in the military does not meet the public’s expectations," but emphasized, "The gift was fully reported and verified when I joined the Democratic Party." He also repeatedly denied the speculation allegations, saying, "Although the media called it a speculative housing purchase, that is not true," and "I did not take out excessive loans to buy it for capital gains."

Regarding suspicions that he was aware of the land transaction permission zone designation in advance, he rebutted, "I did not know at the time and entrusted the procedures to a real estate and tax firm before the gift." He also denied Lee Jun-seok’s insider information claims, calling them "malicious and forced assertions," and said, "The Sampyo Remicon site relocation has been discussed for years."

Reform New Party leader Lee Jun-seok is speaking at the on-site Supreme Council meeting held at the election office of candidate Yang Hyang-ja in Yongin-si, Gyeonggi-do on the morning of the 13th.
[Image source=Yonhap News]

On the same day, Lee Jun-seok shared related articles on his Facebook, stating, "I suspect he is not a representative of the Korean economy but a representative of real estate speculation," and pointed out, "The gifted house reportedly has no mortgage registered on the registry." He sarcastically added, "He gifted it to his 22-year-old son one month before his military discharge, so it seems like a discharge gift."

In particular, Lee claimed, "Right after Gong purchased the building on June 3, 2017, while working at Hyundai Motor, the first agreement for the Sampyo Remicon site (Seongsu-dong) relocation was made on July 10, and in October of the same year, the final agreement for the Sampyo Remicon site relocation was signed between Mayor Park Won-soon of Seoul, Seongdong-gu, Sampyo Industry, and Hyundai Steel. As a Hyundai Motor official, it is inevitable to suspect real estate speculation using insider information."

Candidate Gong strongly rebutted Lee Jun-seok’s claims and counterattacked. He pointed out, "When Lee ran for the general election four years ago, he reported assets of 380 million KRW, but this time he reported 1.92 billion KRW," and added, "He paid only 46 million KRW in taxes over five years, and his assets increased by 1.54 billion KRW in four years." He continued, "I have never seen reports that Lee had a job during that time, and he has openly mentioned profits from cryptocurrency investments. He was once the leader of the ruling party and is currently the leader of a public party, and he is also involved in discussions to improve the system for cryptocurrency investments, which are in a tax blind spot. Is it appropriate to use this tax blind spot for cryptocurrency investments?"

Candidate Gong criticized, "15 billion KRW over four years is money that an ordinary office worker would find difficult to save in a lifetime," and "If an office worker earned 1.5 billion KRW in four years, they should have paid about 700 to 800 million KRW in taxes, which is half." He then challenged, "Please answer whether it is appropriate for someone who has been active in the public political sphere to talk about the future of the younger generation while their assets have increased dramatically but they have paid only 40 million KRW in taxes, which does not meet the public’s expectations."