First Preparatory Hearing for Capital Markets Act Violation
Lee Iljun and Lee Eunggeun: "We Deny All Charges"
Kim Keonhee to Miss August 27 Questioning Citing Health Reasons
The trial for the Sambutogeon stock price manipulation case, which was the first indictment filed by the special prosecutor team led by Min Jungki investigating various allegations related to First Lady Kim Keonhee, began on August 26. The Sambutogeon management appeared in court in person and denied all charges.
The Seoul Central District Court Criminal Agreement Division 34 (Presiding Judge Han Sungjin) held the first preparatory hearing on this day for the case against Chairman Lee Iljun of Sambutogeon and former CEO Lee Eunggeun, who are accused of violating the Capital Markets Act.
Although defendants are not required to attend the preparatory hearing, both individuals appeared in court in person. They denied all charges and pleaded not guilty.
Chairman Lee's legal team argued, "The indictment states that Lee Kihoon, Vice Chairman of Sambutogeon, and Chairman Lee jointly profited, but none of the 17.6 billion won in stock sale proceeds went to Vice Chairman Lee. It is unclear on what factual basis the prosecution claims that they realized profits together," adding, "Chairman Lee did not gain a single won from the sale of Sambutogeon shares."
They further stated, "The sections in the indictment detailing the timing and motive of the alleged crime violate the principle of indictment specificity, and we question whether such details are appropriate in the indictment." The principle of indictment specificity requires that only the facts of the alleged crime be included in the indictment.
Former CEO Lee's legal team also argued, "It is insufficient to view former CEO Lee, who merely played an errand role, as someone who participated in a joint crime resulting in 36.9 billion won in illicit gains," and "We particularly strongly deny the allegation of conspiracy."
Chairman Lee and others are accused of misleading investors in May and June 2023 by making it appear that Sambutogeon would actively participate in Ukraine's reconstruction projects, thereby inflating the stock price and then selling their shares to gain a total of 36.9 billion won in illicit profits.
The special prosecutor team believes that Chairman Lee and Vice Chairman Lee each gained over 17 billion won, and former Chairman Cho Seongok gained 20 billion won. Sambutogeon, classified as a Ukraine reconstruction-related stock, saw its share price surge from around 1,000 won in May 2023 to as high as 5,500 won within two months.
The special prosecutor team indicted Chairman Lee and former CEO Lee on August 1 while they were in detention.
Meanwhile, First Lady Kim Keonhee has decided not to comply with the special prosecutor team's scheduled questioning on August 27. Her legal team announced in the morning that they had submitted a written statement to the special prosecutor team explaining that she is unable to attend due to health reasons. The special prosecutor team has stated its intention to summon her at least once more before her detention period expires on August 31.
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