The conflict between Kim Sang-hee, a member of the Democratic Party of Korea, and Lee Bok-hyun, the Governor of the Financial Supervisory Service (FSS), over the allegations of 'preferential redemption in the Lime Fund' that surfaced last year has resumed in court. Kim's side reiterated their previous claims, stating, "I was also eliminated from the primary election because of this controversy," while Lee's side countered, calling it the "judicialization of politics."
Kim Sang-hee, a member of the Democratic Party of Korea, is holding a press conference at the National Assembly in August last year regarding the preferential redemption allegations related to the Lime Fund. (Photo by Yonhap News)
On the 2nd, Judge Kim Dong-jin of the Civil Division 21 at the Seoul Southern District Court held the first hearing for the 300 million won damages lawsuit filed by Kim against Lee. Kim's legal representative argued, "Our client's reputation was severely damaged by a press release issued by the Financial Supervisory Service that amounted to a false official document, and she suffered the humiliation of being eliminated in the recent primary election. It appears that the defendant distributed this press release because the plaintiff is an opposition party lawmaker, and therefore, he is liable for damages."
This lawsuit began after an FSS investigation revealed that Kim had recovered part of an approximately 200 million won investment from Mirae Asset Securities just before the redemption amid the so-called 'Lime scandal' in 2019, which caused damages exceeding 1 trillion won due to a sudden halt in redemptions. The FSS pointed to this as a preferential redemption and included in their press release that a "multi-term lawmaker" was involved. Subsequent media reports identified this individual as Kim, who denied the allegations, stating she "only accepted the securities firm's recommendation." In September last year, she filed a civil lawsuit seeking 300 million won in damages against Lee. Additionally, she has filed a complaint with the High-ranking Officials' Crime Investigation Unit (HOCI) against Lee for charges including falsification of official documents and disclosure of official secrets. However, neither party appeared in court on this day.
Lee's side argued that there was no problem with the press release and that filing a lawsuit against Lee personally, rather than the institution, constitutes the judicialization of political disputes. Lee's legal representative stated, "The press release did not specify the plaintiff (Kim), nor is there any part that can be considered false in the actual content. Even if some falsehoods were included, considering the plaintiff's status as a public figure, there was substantial reason to believe the information was true, so the claim has no merit." He added, "There is no precedent for identifying the head of a public institution as an individual perpetrator in response to an institutional press release. Filing a civil lawsuit against a public institution head without objective grounds is something the court should avoid, as it brings political disputes into the courtroom."
In fact, the press release only referred to the individual as a "multi-term lawmaker" without naming anyone, and the fact that the person was Kim was revealed through media reports after the press release was distributed. However, Kim's side was evasive when asked whether the FSS was involved in the disclosure of her name, stating, "We believe institutions like Mirae Asset Securities or Lime Asset Management are unlikely to have leaked investor information." At this point, when Kim's lawyer mentioned media coverage unrelated to the trial proceedings, the judge reprimanded him, saying, "The courtroom is not a place for media play."
Since Kim has filed a complaint with the HOCI against Lee on the same matter, the next hearing will not be scheduled until the investigation results from the authorities are available.
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