The Supreme Court overturned the not guilty verdicts of former and current prosecutors who were tried for receiving alcohol entertainment from former Star Mobility Chairman Kim Bong-hyun, a key figure in the Lime Asset Management (Lime) scandal, as well as Kim himself, who provided the entertainment.
The Supreme Court's 2nd Division (Presiding Justice Oh Kyung-mi) on the 8th overturned the lower court's verdicts that acquitted former Chairman Kim, Prosecutor Na, and lawyer Lee Mo, a former prosecutor, who were indicted for violating the Improper Solicitation and Graft Act, and remanded the case to the Seoul Southern District Court.
The court stated, "Considering the relationship between the entertainment provider and the public officials among the defendants and other attendees, their respective statuses, the purpose and circumstances of the entertainment provided, the manner and time of attendance, and the details and characteristics of the entertainment provided, if there is proof of special circumstances that make it impossible to evaluate the value of entertainment received by other attendees as equal to that of the defendant, the value of entertainment received by other attendees should be separated and deducted from the total cost, and the remaining amount should be equally divided among the entertainment provider and the other attendees to determine the value of entertainment for the defendant."
It continued, "Although there is a considerable possibility that the value of entertainment received by Prosecutor Na exceeds 1 million KRW per occasion, the lower court's judgment, which concluded otherwise, misinterpreted the legal principles regarding the calculation of entertainment value in relation to the establishment of the violation of the Improper Solicitation and Graft Act and failed to conduct necessary investigations, which affected the judgment," explaining the reason for the reversal and remand.
Former Chairman Kim and lawyer Lee were tried for conspiring to provide Prosecutor Na with entertainment, including alcohol and side dishes worth approximately 1.14 million KRW, exceeding 1 million KRW per occasion, on July 18, 2019. Prosecutor Na was indicted for receiving entertainment exceeding 1 million KRW per occasion.
At the time, former Chairman Kim said, "I was going to have a drinking party with junior prosecutors," and after receiving a request from lawyer Lee to reserve a drinking venue at a certain pub in Gangnam, Seoul, he made the reservation and entertained Prosecutor Na and two other prosecutors. The total bill for room No. 1, where they drank, including band costs, amounted to 5.36 million KRW.
The prosecution noted that among the five attendees at the drinking party, two prosecutors other than Prosecutor Na left early, so instead of dividing the total bill of 5.36 million KRW by five, they first calculated the amount by evenly dividing 4.81 million KRW, which excluded the 550,000 KRW for the band and entertainment hostess costs added after the two prosecutors left.
Accordingly, the drinking cost provided to the two prosecutors who left early was calculated to be about 960,000 KRW, and they were excluded from prosecution. On the other hand, the prosecution concluded that Prosecutor Na received 1,145,333 KRW by adding the amount evenly divided among the remaining three people of the additional 550,000 KRW to the previously calculated 960,000 KRW and indicted Prosecutor Na.
At the first trial's final hearing, the prosecution requested the court to sentence former Chairman Kim and the other two defendants to six months in prison each, but the court acquitted all three.
The court accepted the defendants' claim that there were two more attendees, former Lime Vice President Lee Jong-pil and former Blue House administrative officer Kim Mo, contrary to the prosecution's claim that there were five attendees. The court judged that it was difficult to see that they briefly entered and left room No. 1 as the prosecution argued.
With the number of attendees increasing to seven, the amount of entertainment per person decreased to 939,167 KRW, and ultimately, the violation of the Improper Solicitation and Graft Act was acquitted on the grounds that the entertainment received did not exceed 1 million KRW.
The court stated, "The base charge for the room is imposed even if no alcohol is consumed, and it is impossible to specify the amount of alcohol and beverages individually consumed by the attendees. Considering that madams and female employees also drink alcohol and beverages together, the base charge should be equally divided among the attendees when calculating the value of entertainment."
It added, "Furthermore, the costs for female employees, madams, and waiters among the additional charges should also be regarded as jointly enjoyed by the attendees and equally divided when calculating the value."
The court recognized that former administrative officer Kim likely attended the drinking party from around 10:30 p.m. on July 18, 2019, until it ended, and former Vice President Lee attended for about 10 minutes from 10:50 p.m. and again for 15 to 20 minutes before the party ended. The court pointed out, "Former administrative officer Kim and former Vice President Lee were invited by the defendants (former Chairman Kim and lawyer Lee) who provided the entertainment, and there are no special circumstances to consider that the portion they enjoyed should be regarded as enjoyed by Prosecutor Na."
The court explained the reason for acquitting by stating, "The method of calculating the value of entertainment for the prosecutor seems reasonable except for the number of attendees, and based on the evidence submitted by the prosecutor, it cannot be said that the value of entertainment in this case exceeds 1 million KRW per occasion beyond reasonable doubt."
The prosecutor appealed, but the second trial reached the same conclusion.
However, the Supreme Court's judgment was different.
The court maintained the existing legal principle that when the costs incurred by each person are unclear in calculating the value of entertainment, the amount equally divided should be regarded as the value of entertainment received by the defendant unless there are special circumstances.
However, the court stated, "If there are special circumstances that justify evaluating the value of entertainment received by multiple public officials differently, it is necessary to reflect such circumstances to appropriately evaluate and attribute the value of entertainment in accordance with the legislative intent of the Improper Solicitation and Graft Act."
The court found that, besides the two prosecutors who left early, former Vice President Lee and former administrative officer Kim had special circumstances that made it impossible to evaluate and calculate the value of entertainment they received as equal to that of Prosecutor Na.
The court cited the following reasons: ▲ the drinking party was arranged to provide entertainment to the prosecutors, ▲ former administrative officer Kim happened to enter room No. 1 and stayed due to a personal friendship with former Chairman Kim, ▲ former Vice President Lee only briefly stayed in room No. 1 upon former Chairman Kim's invitation while discussing responses to asset management company investigations in another room, making it difficult to evaluate that they independently received entertainment or consumed it together with Prosecutor Na.
The 'prosecutor alcohol entertainment' suspicion arose when former Chairman Kim revealed on October 16, 2020, through a 'prison letter' that there had been alcohol entertainment involving current prosecutors. At the time, former Chairman Kim claimed to have entertained four people, including current prosecutors and a lawyer who was a former prosecutor, and also lobbied opposition politicians who were former chief prosecutors and the president of Woori Bank.
As public attention focused, then Minister of Justice Choo Mi-ae ordered an inspection of the prosecutors involved, and then Prosecutor General Yoon Seok-youl ordered a formal investigation. Subsequently, the Seoul Southern District Prosecutors' Office formed a dedicated investigation team for the 'Lime scandal-related prosecutor entertainment receipt case' and began investigating. About 50 days after the investigation started, former Chairman Kim, lawyer Lee, and Prosecutor Na were indicted for violating the Improper Solicitation and Graft Act.
A Supreme Court official stated, "The Supreme Court ruled that the existing legal principles regarding the calculation of entertainment value are maintained in cases of violations of the Improper Solicitation and Graft Act. However, if there are special circumstances that make it impossible to evaluate the value of entertainment received by other attendees equally, the value of entertainment received by other attendees should be separated and deducted, and the remaining amount should be used as the basis for calculating the value of entertainment, in accordance with the principle of responsibility."
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