Major Tasks Facing Independent Counsel Probe into Secret Money Transfer to NK

According to senior officials of the previous government, including former President Kim Dae-jung and of the Hyundai Group, around 500 million won was offered to North Korea. They admitted the secrete transfer of 200 million won to North Korea among the total 500 million won had been made on July. 13, 2000 just before the landmark Inter-Korean Summit. However, it is not clear yet how the remaining 300 million won was created and when it was transferred to the North.

The secrete transfer of 200 million won to Pyongyang was confirmed only by testimonies of concerned officials, not by tracing bank account transactions. Therefore, different stories from what we have already known can be unveiled according to outcomes of the independent counsel`s investigation.

With regard to the remaining 3 million won, suspicion has been already raised that overseas affiliates of the Hyundai Group such as Hyundai Construction and Hyundai Electronics were involved in money transactions. However, in practice, it is impossible to trace bank account transactions carried out overseas. Therefore, to trace the money transactions of 3 million won, investigators of the independent counsel are likely to follow money flow indirectly by obtaining document, such as financial statements of Hyundai overseas affiliates and audit reports of overseas companies. And then, independent counsels are likely to summon people involved in overseas money transactions. In this process, there is the possibility that further stories of the secret money transfer of the 5 million won can be disclosed.

The purpose of the investigation launched by the independent counsel is to find out whether the secret money transfer was designed to bring North Korean leader Kim Jung-il to the historical scene of the 2000 inter-Korea summit or to secure Hyundai`s exclusive business rights in the North. When the secret money transfer was unveiled, officials of the former government and the Hyundai Group insisted that the secret money transfer was made to secure exclusive business rights in the North. However, there are some suspicious aspects. A total of 200 million won was illegally sent to the North just before the landmark inter-Korean summit and officials of the former government and the company, who had previously denied the money transfer, began to admit it altogether after the Board of Audit and Inspection released the results of its audit of the Korea Development Bank.

It is premature to tell whether the money was for Hyundai`s exclusive business rights in North Korea or a pay-off for the Inter-Korean summit. What is truth will be determined by the outcomes of the on-going investigation.

Another task facing the independent counsel investigation is to find out whether the National Intelligence Service turned a blind eye to the secret money transfer to the North by Hyundai Merchant Marine or the former Kim Dae-jung government was fully involved in the whole process of the secret money transaction. If the former government`s deep involvement in the process is disclosed through the investigation, it can be a proof that the secret money transfer was made not for the exclusive business rights in the North.

Sang-Rok Lee Jin-Kyun Kil myzodan@donga.com leon@donga.com