Lee Hyung-Taek Arrested

Lee Hyung-Taek, former executive of Korea Deposit Insurance Corporation, was arrested by the Special Prosecutor Cha Jeong-Il for the charge of the lobbyist activities through Cheong Wa Dae, National Intelligence Service, ROK Navy, and other government organizations for the treasure excavation project from which he contracted to receive 15 percent of the profit.

The Special Prosecution team (SP) arrested Mr. Lee Hyung-Taek, who was summoned as a witness and had been under investigation for two days, and will request for the arrest warrant on the 31st.

SP found circumstantial evidence that Mr. Lee hid the documents, accounting books, bank accounts related to the excavation projects before the search and confiscation of SP and laundered money several times through his accountant.

SP revealed that the 15 percent profit from the excavation project was a reward for the lobby through NIS and Lee Ki-Ho, former senior secretary to the President.

However, Mr. Lee`s lawyers submitted a statement of protest to SP, which reads "The fact that Mr. Lee requested the support of national organizations for his business is not an object of the SP investigation."

Therefore, SP must present the statement of protest and its opinion to the Seoul High Court in 24 hours and the court must make a decision in 48 hours.

However, Mr. Lee strongly denied the allegation and is planning to request the court to review the warrant if the arrest warrant is requested.

SP grilled Mr. Lee on whether he was involved in the stock price manipulation and the issue of overseas convertible bonds (CB) of SamaeIndus owned by Lee Yong-Ho. They also interrogated him on whether he exerted influence on the process in which Korea Industrial Bank took over 22 billion won of the corporate bonds of Shinhwa Construction which participated in the treasure excavation project, and whose contract Hanvit Bank guaranteed.

SP also held a cross investigation about the financial transaction through Mr. Lee H.T., Hur Ok-Seok (imprisoned), and Lee Yong-Ho.

SP summoned Wui Seung-Bok, the governor of Choheung Bank, as a witness in the investigation of how Lee Yong-Ho took over Choheung Capital from Choheung Bank in September through November 2000.

Meanwhile, SP summoned Lim Yang-Woon, the third deputy director of Seoul District Prosecutors Office when Lee Yong-Ho case was under investigation in May 2000, to question whether he leaked the investigation information or he ordered to cover up the case.

myzodan@donga.com