Prosecutor General Orders Central District Prosecutors' Office to "Thoroughly Investigate Timef Incident" (Comprehensive Report 2)

Prosecutors Trace Tmep Accounts in 1 Trillion Won Fraud and Embezzlement Case... Following the Money Flow

Prosecutor General Lee Won-seok instructed the Seoul Central District Prosecutors' Office, which formed a dedicated team to investigate the unsettled payment incident involving TMON and WEMAKEPRICE (TMEP), to conduct a thorough investigation into the allegations against major shareholders and management.

On the 1st, the Supreme Prosecutors' Office announced that Prosecutor General Lee received a report on the investigation status and plans regarding the TMEP incident from Lee Chang-soo, head of the Central District Prosecutors' Office, and gave these instructions. According to the Supreme Prosecutors' Office, the Prosecutor General said, "Along with promptly analyzing the seized evidence, conduct a detailed investigation into the flow of funds and asset tracking, thoroughly investigate the allegations against major shareholders and management, and hold them strictly legally accountable to minimize damage to consumers and sellers."

Prosecutor General Lee Won-seok is making a statement on the Democratic Party's impeachment motion against prosecutors at the Supreme Prosecutors' Office press room in Seocho-gu, Seoul on the 2nd. Photo by Jo Yong-jun jun21@

Based on the results of the compulsory investigation against TMEP officials and corporations, the prosecution is expected to prove criminal charges.

The Anti-Corruption Investigation Division 1 of the Seoul Central District Prosecutors' Office (Chief Prosecutor Lee Jun-dong) has been conducting searches and seizures at a total of 10 locations since the morning, including the residences of Koo Young-bae, CEO of Qoo10 Group, Ryu Kwang-jin, CEO of TMON, and Ryu Hwa-hyun, co-CEO of WEMAKEPRICE, as well as seven related corporate offices. This large-scale operation, involving 85 investigative personnel including seven prosecutors, took place just three days after the dedicated investigation team was formed on the 29th under the Prosecutor General's directive.

The prosecution tentatively considers that charges of fraud amounting to about 1 trillion won may be applied to CEO Koo and others. To examine this, they have also begun tracing accounts related to the parent company, Qoo10 Group. The dedicated investigation team of the Seoul Central District Prosecutors' Office obtained search warrants from the court the previous day for seven offices of Qoo10 Korea, TMON, WEMAKEPRICE, and three residences of CEO Koo Young-bae and other executives, along with warrants for account tracing related to the corporations and management involved in the case.

Koo Young-bae, CEO of Qoo10 Group, is speaking at the urgent inquiry on the "Timon and Wemakeprice Settlement and Refund Delay Incident" held by the National Assembly's Political Affairs Committee on the 30th. Photo by Hyunmin Kim kimhyun81@

The Financial Supervisory Service (FSS) reported on the 26th of last month that illegal activities were detected in Qoo10's fund flows and referred the matter to the prosecution, handing over related materials. The prosecution is directly verifying this and has initiated account tracing to secure evidence. The prosecution plans to track the whereabouts of sales proceeds by comparing and analyzing account tracing data alongside FSS materials. In particular, they are expected to focus on how TMON and WEMAKEPRICE's funds were managed and whether sales proceeds were excessively used as acquisition and merger funds for Qoo10 Group affiliates.

CEO Koo already admitted at the National Assembly's Political Affairs Committee on the 30th of last month that "400 billion won of TMON and WEMAKEPRICE funds were used as acquisition funds for 'Wish,' a global internet shopping mall, and that this included sales proceeds." However, CEO Koo stated that this amount was repaid within a month and is unrelated to the current payment delay situation.

In this regard, it is reported that the search warrants for CEO Koo and others included charges of fraud amounting to about 1 trillion won. Additionally, it is said that embezzlement charges of 40 billion won were specified against them. Legal circles believe that the amount related to embezzlement and breach of trust charges is likely to increase as the investigation progresses.