Prosecution Drops Appeal in Wirye Case...Acquittals Finalized After Daejang-dong

Not-guilty verdicts for Nam Uk, Jeong Yeonghak, and Yoo Donggyu finalized

Prosecutors have decided not to appeal the first-instance ruling that acquitted private business operators indicted over alleged corruption in the Wirye New Town development project.

From left: Yoo Donggyu, former Head of Planning at Seongnam Urban Development Corporation, Nam Wook, lawyer, Jung Younghak, accountant. Provided by Yonhap News

On the 4th, the last day of the appeal period, the Seoul Central District Prosecutors' Office announced, "After comprehensively considering the results of our legal review and the likelihood of an appeal being upheld, we have decided not to file an appeal."

A prosecution official explained, "We decided not to appeal after sufficient discussions with the Supreme Prosecutors' Office," adding, "The Minister of Justice has not exercised investigative command authority, nor has any separate directive been issued."

Earlier, the court acquitted at first instance private business operators including Yoo Donggyu, former Head of Planning at Seongnam Urban Development Corporation, lawyer Nam Wook, and accountant Jung Younghak, who had been indicted on charges of violating the Anti-Corruption and Civil Rights Commission Act (now the Conflict of Interest Prevention Act).

The court determined that the information obtained by the private business operators in the course of promoting the Wirye development project constituted a legal "secret," on the grounds that disclosure of such information to the outside could undermine fair competition and that collusion between public officials and private operators could cause social distrust.

However, the court viewed that what the defendants directly obtained by using this confidential information was nothing more than business-operator status, and that additional acts and the involvement of third parties would have been necessary to obtain the dividend profits specified in the indictment. Since dividends would only arise after a series of subsequent procedures, including Seongnam City's project approval and review, sales, and apartment construction, the court held that it is difficult to recognize a direct causal relationship between the status as a business operator and the dividend profits.

With prosecutors abandoning their appeal, the acquittals of the private business operators have now been finalized. As a result, it is expected that all asset-freeze measures imposed for seizure and preservation in connection with the case will also be lifted.

This decision has led to speculation that the likelihood of an acquittal has also increased for President Lee Jaemyung on charges related to the Wirye case, for which the trial is currently suspended. President Lee had been standing trial in four cases, including alleged corruption in the Daejang-dong, Baekhyeon-dong, and Wirye New Town development projects and alleged illegal sponsorship to Seongnam FC, but the proceedings were halted after his election as president.

Prosecutors had previously also given up appealing parts of the first-instance ruling that acquitted defendants in the Daejang-dong development corruption case, which has a structure similar to the Wirye case. At that time, suspicions arose that the investigative team’s recommendation to appeal had been rejected, triggering collective backlash and a public statement by chief prosecutors. In the process, the acting Prosecutor General resigned, and a reshuffle of high-ranking officials followed, resulting in major repercussions.