Squabbles over fund scam scandal spilling over to political circles

SEOUL, Oct. 19 (Yonhap) -- Rival parties locked horns Monday over a swelling financial scam scandal following the recent allegation of involvement by influential politicians and prosecutors.

Kim Bong-hyun, a key suspect in the financial fraud case involving Lime Asset Management Co., claimed in a written statement last Friday that he lobbied prosecutors and politicians of both the ruling and opposition camps before the investigation into the case was launched early this year.

The claim by Kim, the former owner of Star Mobility, assumed to be the main financial source for Lime, turned the table on the scandal after Cheong Wa Dae and government officials were initially alleged to have been implicated in the case.

Lime and another asset management firm, Optimus, are currently at the center of what could develop into a large-scale political lobbying scandal.

Lime and Optimus together generated more than 2 trillion won (US$1.75 billion) in losses for some 5,000 investors after the companies suspended fund redemption due to massive financial losses last year and earlier this year, respectively.

The ruling Democratic Party (DP) lashed out at the prosecution Monday, accusing it of fabricating its initial investigation result, and said the case warrants the party's push to launch an independent investigation office as the case allegedly involves high-ranking officials.

"At least from now and onward, a thorough investigation should be carried out (by the prosecution)," DP Chairman Rep. Lee Nak-yon said during the party's top council meeting.

"Together with it, (DP) will (further) hasten the launch and operation of the Corruption Investigation Office For High-ranking Officials," Lee said, referring to an envisioned organization.

Speaking at the same meeting, DP floor leader Rep. Kim Tae-nyeon accused the prosecution of choreographing the scam investigation against the ruling camp and fabricating probe results.

The main opposition People Power Party (PPP) blamed Justice Minister Choo Mi-ae for what it called lack of objectivity in related investigations and demanded the launch of an independent special counsel probe into the case.

"In order to resolve the Lime and Optimus issue in the most objective and fair manner, I formally propose the launch of a special counsel probe," PPP leader Kim Chong-in said in the party's top council meeting earlier in the day.

"Would the public be able to trust the objectivity of (the prosecution's) investigation when the prosecution and the justice ministry are at odds," Kim said, referring to tension between Choo and Prosecutor General Yoon Seok-youl over the latest revelation.

Adding to the call, PPP floor leader Rep. Joo Ho-young said he will soon submit a bill formally requesting the opening of an independent investigation into the cases.

"Putting the matter to a thorough investigation by a special counsel, the ruling and opposition parties should immediately end their dispute over the issue," Joo said, adding that the bill will be submitted as soon as possible.

Also on Monday, the justice ministry asked the Seoul Nambu District Prosecutors Office to investigate Kim's lobbying claims.

In his recent statement, Kim said that he had his lawyer treat three incumbent prosecutors with a drinking party worth 10 million won last year. One of them took part in the actual investigation into the Lime scandal, he claimed.

"Through an inspection, we identified some of the prosecutors facing the financial and other favor-taking allegations," according to the ministry.

"The ministry concluded that the case needs a prompt investigation and requested its investigation (on possible charges of) bribe taking and violation of the Improper Solicitation and Graft Act," it said.

The action by the ministry came one day after it accused the prosecution service of sitting on Kim's previous testimony against its own members and opposition politicians.

pbr@yna.co.kr
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