Independent Counsel Examines Hyundai Chairman Chung

Independent Counsel Song Doo-hwan, currently investigating the Kim Dae Jung administration`s secret checkbook diplomacy with North Korea, summoned Hyundai Asan Chairman Chung Mong-hun, President Kim Yoon-gyu and another Hyundai affiliate President Kim Jae-soo in for questioning. Song put the heat on to uncover any involvement in the scandal and all matters surrounding it.

The Independent Counsel`s office filed a motion for an arrest warrant on former presidential aide Lee Kee-ho on charges of malfeasance. Lee is suspected of pressuring Korea Industrial Bank into giving a 400-billion won loan to Hyundai Merchant Marine. The court is expected to rule on the motion for the arrest warrant on Lee late today.

Regarding the summons of Chairman Chung, a source familiar with the case said that they would “use whatever means available,” indicating that criminal proceedings may be taken.

The office grilled Chairman Chung to find out his involvement in the wiring of money to Pyongyang and the North-South summit. They want to know whether he demanded any return from the Kim Dae-jung administration for the money transfer, and whether he intentionally employed window-dressing techniques to hide the transactions.

Contrary to Hyundai`s explanations, Hyundai used most of the 176.5 billion won in connection with the wiring to the North. It was already known that Hyundai sent 223.5 billion of the 400-billion won loan to the isolated regime.

According to the investigation result of the Counsel`s office, 100 billion won of the 175.6 billion won was used for buying Hyundai`s CP on June 8, 2000. The rest, 76.5 billion won, was divided into one billion won units and funneled to Hyundai Merchant Marine. Hyundai argues that the 176.5 billion won was spent on business operation expenses.

The Independent Counsel’s office confirmed that "the money used to support Hyundai Construction seems to have handled the aftermath of the $150 million fund wired to North Korea." Therefore, the $500 million fund sent to Pyongyang came from Hyundai Merchant Marine ($200 million), Hynix ($100 million) and Hyundai Construction (150 million).

Now, the office is trying to find out how the unidentified $50 million fund was raised and sent to Pyongyang.

leon@donga.com jarrett@donga.com