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Prosecution on trail of big-name investors in Chung's private fund

Prosecution on trail of big-name investors in Chung's private fund

Posted October. 26, 2000 19:46,   


The district prosecution, now investigating the illegal loans made by the Dongbang Mutual Saving & Finance Co., is probing people who joined the private mutual savings and finance company created by Chung Hyun-Joon, president of Korea Digital Line (KDL), after receiving the list of people involved from the Financial Supervisory Service(FSS).

Prosecution authorities said that as the FSS list contains some people with false names, it is now trying to find out their real identities. But they disclosed that no names of government officials or reputed personalities have been found on the list thus far, adding that the prosecution is investigating whether there were some illegalities involved in the operations of the private financing firms.

The prosecution plans to verify suspicions that Lee Kyung-Ja, Dongbang's vice chairman, illegally took out 63.7 billion won from her company and other charges brought against her. It will then take action against her on charges of violating relevant laws and move to examine the suspicions surrounding the political sector.

The prosecution attempted to find out whether Chung or Lee masterminded the illegal loan scam through lengthy cross-examinations of both suspects, but has so far failed to determine who is the main culprit as the two are incriminating each other.

Accordingly, the prosecution is now examining a bundle of documents from the financial watchdog on the illegal loan provisions and related bank accounts. The prosecution has probed some 10 persons suspected of having consulted with Lee on her investments, as well as working-level officials of the Dongbang and Daishin Mutual Finance.

Meanwhile, the prosecutors, receiving search warrants from the court, inspected about 10 places, including the KDL, Dongbang in Seoul, Daishin in Inchon and the houses of Chung and Lee, but failed to find any materials related to the loan scandal as the places had been already cleared out.

Related prosecution sources said that the prosecution was unable to track down any cases of lobbying politicians, except for some suspicions it uncovered involving a bureau director and a few officials of the FSS. With regard to media reports that some 4 billion won was illegally used for lobbying, the prosecution disclosed that both Chung and Lee had denied the allegations.