Chief Justice Suspected of Tax Evasion

Supreme Court Chief Justice Lee Yong-hoon explained at a press conference held on January 4 in regard to his being suspected of failing to report 50 million won he was paid while working as a lawyer: “I reported even 0.3 million won I was paid for consultation on the income statement turned in to the tax accountant’s office. I never lied as a man of faith.”

Lee received 250 million won in total for taking a case in which the U.S. securities company Goldman Sachs applied for the legal management of Jinro in April of 2003. In the process of reporting this to the tax authorities, he did not declare 50 million won. On January 3 when this was revealed, he paid 27.71 million won for taxes, including general income tax, to a tax officer in charge.

As the scandal was still rampant even after he paid taxes, Lee asked for a press conference and said on January 4, “I can even show my bankbook to you if you want to know how I managed my income. I never thought about the possibility of a tax accountant making a mistake in the process of transcribing my income statement.”

In regard to his statement on last November that he would rather discard his position if he ever evaded a penny in taxes, Lee explained it was “because he did not know (the mistake made by his tax accountant).” “I handed in all the detailed statements (to the press). If I knew there’s something wrong in those statements, I wouldn’t have handed them in,” he added.

Despite Lee’s explanation, however, the scandal may not subside.

Last November, there was a similar debate about Lee’s involvement in Lone Star’s purchase of Exchange Bank.

When the court kept rejecting prosecutors’ request of warrants in relation to the case, some prosecutors argued that the court’s decision was influenced by the fact that Lee was paid for taking as a lawyer the case of Exchange Bank’s billing 32 billion won to Geukdong City Gas.

Participating as a lawyer in the first trial of Samsung Everland CB anomaly gift case, Lee also submitted to the court his opinion that issuing CB at a lower price is not misappropriation.

The legal circle is mostly accepting Lee’s explanation that it was a “simple mistake.”

Prosecutors are cautious about mentioning the scandal not to be misunderstood. A prosecutor said, “There can be a mistake when paying lots of taxes. That kind of simple mistake cannot be punished, and just an additional charge for the dropped sum will be made.”

On the other hand, the Korean Bar Association expressed its opinion on January 4, saying, “It is hard to know whether it was an intentional evasion of taxes or a simple mistake. Even though we accept his excuse, it needs to be clearly explained how such a mistake was made possible.”

A source in the Supreme Court argued, “(Chief Justice Lee) made 6 billion won by taking 472 cases for five years and paid 2.3 billion won for taxes. If just one mistake was made in the process, he should be considered upright.”

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