[Exclusive] Prosecution Imminent for Youngpoong Paper Owner Gongmo Family Member...Key Accomplice Says "Asked to Manipulate Market Prices"

The prosecution plans to indict Gong Mo (44), who was recently detained, along with three of his associates as early as the 17th in connection with the Yeongpung Paper stock manipulation scandal. Gong is a member of the Daeyang Metal owner family that acquired Yeongpung Paper in 2022 and is a key figure in this price manipulation case, where the amount of illicit gains reaches 661.6 billion KRW.

The group involved in stock manipulation of Youngpoong Paper appeared at the Seoul Southern District Court in November last year. (Photo by Yonhap News) [Image source=Yonhap News]

At the trial of the Yeongpung Paper case held on the same day at the Seoul Southern District Court Criminal Division 12 (Presiding Judge Dang Woojeung), the prosecution stated, "We plan to indict a total of three people, including Gong, within today." Gong is the actual owner of Yeongpung Paper, and the other two are unregistered executives affiliated with Yeongpung Paper, known to be close associates of Gong. All three were detained on the 2nd.

Earlier, Lee Mo (51), the mastermind of the stock manipulation gang who was captured while on the run and indicted in February, expressed his position on the prosecution's charges for the first time on this day. Lee's lawyer stated, "He admits to and regrets the price manipulation itself," but argued, "Lee became involved to raise funds after receiving a request from Gong, who intended to acquire Yeongpung Paper, to carry out the price manipulation. The accusation that Lee sought to profit from the price difference is unfair." He added, "The calculation of 660 billion KRW in illicit gains applied to Lee's charges is incorrect, and we plan to clarify the roles, interests, and actual beneficiaries of the defendants in the future."

When the Yeongpung Paper scandal first broke out around October last year, Lee, the mastermind, fled to evade the prosecution's investigation and was later arrested in February while attempting to stow away. Meanwhile, the accomplices who were caught earlier all admitted to the crime but shifted all responsibility to Lee, saying they acted under his orders. On this day in court, Lee also claimed that he committed the crime at the request of Gong, the actual owner of Yeongpung Paper, and that Gong was the one who actually benefited from the price manipulation.

In the securities industry, suspicions of owner family involvement had circulated early on regarding the unusually sharp rise in Yeongpung Paper's stock price from October 2022 for about a year. As the prosecution's investigation now targets the key figure Gong, the full details of the price manipulation are expected to be revealed during the trial process. However, due to repeated procedural issues such as case consolidations and separations, the first trial has been ongoing for more than six months, and the main defendants have been released on bail one after another. If Gong is indicted soon, there is also a possibility of additional case consolidations.