Prosecutor Impeachment Fallout Slows Corruption Investigations: Companies Hold Their Breath Amid Fears of a Bigger Storm

As the prosecutor impeachment crisis prolongs, key leadership positions including Lee Chang-soo (53, Judicial Research and Training Institute class 30), Chief Prosecutor of the Seoul Central District Prosecutors' Office, Jo Sang-won (52, class 32), 4th Deputy Chief Prosecutor, and Choi Jae-hoon (49, class 34), Head of the Anti-Corruption Division 2, have become vacant, leaving corporate corruption investigations at the Seoul Central District Prosecutors' Office effectively in a state of 'business suspension.' While investigations have temporarily halted, companies facing judicial risks are taking a breather but remain tense, closely monitoring the prosecutors' movements.

Yonhap News

At frontline prosecutors' offices including the Seoul Central District Prosecutors' Office, numerous complaints and accusations are piled up involving allegations of preferential treatment of orders within companies, unfair support to affiliates, slush funds of corporate heads, and tax evasion. Although cases have been assigned, investigations have not been properly conducted.

Besides the impeachment led by the Democratic Party of Korea, the investigation related to the December 3 martial law has caused the prosecution to lose momentum in corporate corruption investigations. Except for the real estate PF loan corruption case, which was nearing conclusion after the impeachment of Lee Chang-soo, Chief Prosecutor of the Seoul Central District Prosecutors' Office in December last year, ongoing investigations have effectively come to a halt. A prosecutor at the Central District Prosecutors' Office lamented, “Without a chief prosecutor, it is practically difficult for investigation teams to operate independently. The leadership role is essential, especially for large-scale cases,” expressing the difficulties caused by the leadership vacuum.

Major investigations at the Seoul Eastern District Prosecutors' Office, such as the Coupang Fair Trade Act violation case and the SK-Alchemist transaction suspicion case, have also effectively stopped. The Coupang algorithm ranking manipulation case has seen no significant progress since the office raid, and the SK-Alchemist case reportedly has not undergone further investigation since case assignment.

Some companies have temporarily breathed a sigh of relief due to the unexpectedly delayed investigations but remain on high alert. This is because not only assigned cases but also corporate corruption cases reported by the National Tax Service, Financial Supervisory Service, and Fair Trade Commission are still piled up on the prosecutors' desks. A lawyer who is a former chief prosecutor said, “Large-scale corporate investigations require organizational judgment and strategy, so in the absence of leadership, the pace inevitably slows down. Once the command system is reorganized, investigative momentum will resume.”

Woo Bin, Legal Newspaper Reporter

※This article was written based on content provided by the Legal Newspaper.

※This article is based on content supplied by Law Times.