Seoul High Prosecutors' Office Begins Review of Kim Yeo-sa's 'Deutsche No Charges' Case

Central District Prosecutors' Office Submits Appeal Opinion and Investigation Records to High Prosecutors' Office
Criminal Division Review Likely Under Prosecutor General's Direction

The Seoul High Prosecutors' Office has begun a review to determine whether it was appropriate for the prosecution to dismiss charges against Kim Keon-hee, wife of President Yoon Suk-yeol, in connection with the Deutsche Motors stock manipulation case.

On the 10th, Yonhap News reported that the Central District Prosecutors' Office sent an opinion letter and investigation records regarding Kim's appeal in the Deutsche Motors case to the higher-level Seoul High Prosecutors' Office on the 8th. Earlier, Choi Kang-wook, a former lawmaker and the accuser in the case, submitted a statement of reasons for appeal to the Central District Prosecutors' Office after Kim was cleared of charges. After reviewing the statement, the Central District Prosecutors' Office found no grounds for the appeal and forwarded the records to the Seoul High Prosecutors' Office. The Seoul High Prosecutors' Office plans to assign the case to the criminal division soon and examine whether a reinvestigation is necessary.

First Lady Kim Keon-hee, who accompanied President Yoon Suk-yeol to the ASEAN Summit, is seen arriving at Wattay International Airport in Vientiane, Laos, on the 9th of last month (local time), engaging in conversation with Laotian officials who came to welcome her.
[Photo by Yonhap News]

During the investigation stage at the Central District Prosecutors' Office in 2020, under the direction of then Minister of Justice Choo Mi-ae, the Prosecutor General's authority to direct the investigation was revoked; however, once the case is transferred to the High Prosecutors' Office, Prosecutor General Shim Woo-jung can directly oversee the investigation. Last month, at the National Assembly inspection, Prosecutor General Shim stated that if the appeal proceeds and the case is transferred to the Seoul High Prosecutors' Office, he would exercise his authority to direct the investigation.

Kim is accused of conspiring with former Deutsche Motors Chairman Kwon Oh-soo, who was sentenced to imprisonment in the second trial, to manipulate stock prices. Kim participated in a paid-in capital increase of the former Deutsche Motors in December 2007, receiving stocks worth approximately 200 million KRW, which she sold entirely by May 2009. Subsequently, she acquired Deutsche Motors stocks worth 800 million KRW through a block deal from Duchang Textile, operated by former Chairman Kwon, and sold all of them within a month. Kim continued to trade Deutsche Motors stocks through six accounts that she either managed directly or entrusted for investment.

Kim has fully denied the charges, stating, "My relationship with former Deutsche Motors Chairman Kwon Oh-soo was that of a business executive and investor. Based on trust in Kwon as a manager, I believed in the potential growth of Deutsche Motors and invested, but I had no knowledge whatsoever of any stock price manipulation by Kwon or others."

Last month, the Anti-Corruption Investigation Division 2 (Chief Prosecutor Choi Jae-hoon) of the Seoul Central District Prosecutors' Office announced a non-prosecution decision against Kim, who was suspected of violating the Capital Markets Act. The Deutsche Motors stock manipulation case began in April 2020 with a complaint by former lawmaker Choi Kang-wook during the tenure of Central District Prosecutors' Office Chief Lee Sung-yoon and has passed through four investigative teams over four and a half years.

The Seoul High Prosecutors' Office is expected to determine whether there were any deficiencies in the Central District Prosecutors' Office's investigation process and whether additional investigation is required, ultimately deciding whether to order a reinvestigation.