Today at Suwon District Court, First Trial Verdict for Ihwa-Young... Focus on Judgment of 'North Korea Remittance' Involving Representative Lee Jae-myung

The court's first ruling on former Gyeonggi Province Deputy Governor for Peace Lee Hwa-young, who has been on trial for involvement in allegations of illicit payments related to the North Korea remittance scandal?specifically that Ssangbangwool Group covered the costs of Lee Jae-myung, leader of the Democratic Party of Korea's visit to North Korea?will be announced on the 7th.

With the prosecution expected to additionally indict Lee Jae-myung on charges of illegal remittance to North Korea, the judiciary's decision regarding Lee Hwa-young's related charges on this day is anticipated to directly influence not only the prosecution's future indictments but also the determination of Lee Jae-myung's guilt or innocence.

Lee Jae-myung, leader of the Democratic Party of Korea (left), and Lee Hwa-young, former Deputy Governor for Peace of Gyeonggi Province, ahead of the first trial sentencing hearing on charges including illegal remittance to North Korea on the 7th. [Image source=Yonhap News]

The Criminal Division 11 of Suwon District Court (Presiding Judge Shin Jin-woo) will conduct the sentencing hearing from 2 p.m. on this day for former Deputy Governor Lee, who was detained and indicted on charges including violation of the Foreign Exchange Transactions Act, violation of the Act on the Aggravated Punishment of Specific Crimes (bribery), violation of the Political Funds Act, and obstruction of justice by evidence destruction.

Lee was detained and indicted in October 2022 on charges of receiving bribes worth hundreds of millions of won and illegal political funds from Ssangbangwool Group between July 2018 and July 2022 by means such as being provided with corporate credit cards and vehicles and paying false salaries to his associates. During the trial, in March last year, he was additionally indicted on charges of having asked former Ssangbangwool Chairman Kim Sung-tae to cover a total of 8 million USD, including 5 million USD for the smart farm project costs promised by Gyeonggi Province to North Korea and 3 million USD for Lee Jae-myung's visit expenses to North Korea. A month later, in April last year, he was further indicted on charges of requesting Ssangbangwool Vice Chairman Bang Yong-cheol to delete data related to his use of corporate credit cards ahead of the prosecution's investigation.

The most attention-grabbing charge among these is the one related to illegal remittance to North Korea (violation of the Foreign Exchange Transactions Act).

The prosecution has investigated Lee as an accomplice, believing that he conspired with former Chairman Kim to smuggle large sums of dollars to China without reporting or approval and then paid them to the Korean Workers' Party, which is subject to financial sanctions, and that Lee Jae-myung was informed in advance by Lee Hwa-young about this process. Former Chairman Kim has consistently admitted to the related charges, and Lee Hwa-young also testified during the prosecution's investigation that he reported to Lee Jae-myung.

However, during the trial, Lee Hwa-young retracted his statements related to Lee Jae-myung. Around the time of this retraction, Lee's wife submitted a petition to the Democratic Party, he unilaterally dismissed the lawyer he trusted, caused disturbances in court, and claimed coercion or pressure from the prosecution through letters from prison.

In early April, just before the general election, Lee Hwa-young was embroiled in controversy over allegations that he held a drinking party with former Chairman Kim and others inside the prosecution office, enjoying soju with salmon side dishes. This allegation was first raised by Lee's defense attorney Kim Kwang-min on a YouTube broadcast in December last year. When the prosecution refuted the claim based on objective evidence such as Lee's departure records and a full investigation of the correctional officers who guarded him, Attorney Kim kept changing the dates of the alleged drinking party and eventually wavered even on whether Lee had consumed alcohol, ultimately ceasing further rebuttal. The Democratic Party, which had supported Lee's claims and even mentioned a state audit or special prosecutor, has also stopped related attacks.

In September last year, Judge Yoo Chang-hoon, who handled Lee's warrant review, stated, "It is difficult to say that Lee Hwa-young's previous statements to investigative agencies were made without voluntariness," and added, "There are circumstances that raise suspicion of improper interference by persons close to the suspect (Lee Jae-myung) regarding Lee Hwa-young's statements."

On the afternoon of September 12 last year, Lee Jae-myung, the leader of the Democratic Party of Korea, who was leaving the Suwon District Prosecutors' Office in Yeongtong-gu, Suwon-si, Gyeonggi-do after an investigation related to the 'North Korea remittance' suspicion, and Park Gyun-taek, a member of the National Assembly who was present as Lee's lawyer during the investigation, are answering questions from the press.

Although the prosecution has not yet indicted Lee Jae-myung on charges related to illegal remittance to North Korea, they believe it would have been difficult for Lee Hwa-young to unilaterally push forward illegal remittances with Ssangbangwool without the approval of Lee Jae-myung, who was then the Governor of Gyeonggi Province. The fact that Lee Jae-myung was the ultimate beneficiary of the remittance is also why the prosecution considers him an accomplice of Lee Hwa-young.

Therefore, the court's ruling on Lee Hwa-young's charges related to illegal remittance to North Korea is expected to have a decisive impact on the timing of Lee Jae-myung's indictment and the court's judgment on his guilt or innocence. Particular attention will be paid to which of Lee Hwa-young's contradictory statements about Lee Jae-myung, made in court and to the prosecution, will be deemed credible.

Seemingly aware of this, at the bail hearing held on the 21st of last month, Lee Hwa-young's defense attorney stated, "Although Representative Lee Jae-myung has not been indicted as a co-defendant in the illegal remittance case with defendant Lee Hwa-young, the indictment states that Lee Jae-myung, currently the opposition party leader, is named as a co-conspirator," and added, "A guilty verdict against Lee Hwa-young will inevitably serve as a strong judicial document presuming Lee Jae-myung's guilt in the future."

He also pressured the court, saying, "It is foreseeable that Lee Jae-myung will run in the upcoming presidential election," and "If a guilty verdict is rendered, the court must clearly explain the reasons for attributing guilt to Lee Jae-myung, who is listed as a co-conspirator with Lee Hwa-young."

Meanwhile, at the prosecution's sentencing hearing for Lee Hwa-young held on April 8, the prosecution requested the court to sentence him to 15 years in prison and a fine of 1 billion won. The prosecution sought 12 years imprisonment and a 1 billion won fine plus confiscation of approximately 334 million won for bribery and violation of the Political Funds Act, and 3 years imprisonment for violation of the Foreign Exchange Transactions Act and obstruction of justice by evidence destruction.

At that time, the prosecution explained the reason for seeking a heavy sentence, stating, "This case is a serious example of regressive collusion between high-ranking officials and a mid-sized company, Ssangbangwool, connected through inter-Korean economic cooperation projects amid the reality of the divided Korean Peninsula." They also added, "Lee Hwa-young's acts of obstructing justice during the trial are shocking behaviors that undermine the judicial system, which should discover justice and truth, and this is another reason for a heavy sentence."

The outcome of this trial is also expected to influence the intensity of the Democratic Party's future offensives, which have introduced a special prosecutor law targeting prosecutors who investigated Lee Hwa-young, alleging 'coercion at drinking parties.'

Earlier, on the 3rd, four days before Lee Hwa-young's first trial sentencing, the Democratic Party proposed the "Special Prosecutor Law for Truth Investigation into the Prosecution's False Testimony Coercion in the Kim Sung-tae North Korea Remittance Case."

Regarding this, Prosecutor General Lee Won-seok strongly criticized, saying, "The fact that the investigation target, Deputy Governor Lee Hwa-young, and the Democratic Party side have proposed a special prosecutor law to investigate the prosecution is something the public can understand the meaning, purpose, and intention of," and added, "The prosecution views such a special prosecutor as intimidation against the prosecution and pressure on the judiciary, and therefore considers this special prosecutor law as judicial obstruction."

Considering the expected influx of spectators to observe Lee Hwa-young's sentencing hearing, Suwon District Court prepared a video relay courtroom in Room 301, in addition to Room 204 on the second floor of the courthouse where the trial is held, to allow remote viewing of the trial.

Applications for online attendance were accepted over two days from the 3rd to the 4th, and attendance tickets were distributed on the 7th only to those selected by lottery on the morning of the 5th. Seats are assigned randomly. There are a total of 69 seats available for viewing: 13 in the trial courtroom and 56 in the video relay courtroom. The number of people allowed inside the courtroom will be limited to the number of seats, and standing room for watching the trial is not expected to be permitted.