Go to contents

Independent Counsel Announces Outcome of Probe into Money Transfer

Independent Counsel Announces Outcome of Probe into Money Transfer

Posted June. 25, 2003 21:53,   


The independent counsel team said June 25 that the Kim Dae-jung administration promised to pay 100 million dollars out of 500 million dollars to North Korea in return for the inter-Korean summit in June 2000.

In addition, the counsel confirmed that the 400 billion dollars paid by Hyundai Group was known as money for business rights in the North but was in fact bribery for the summit.

Wrapping up the probe, Independent Counsel Song Doo-hwan announced the outcome of his 70-day investigation on the money transferred over the border.

According to the counsel, the former government and Hyundai Group promised to pay 100 million dollars and 400 million dollars respectively on April 3, 2000 when they finally agreed to hold the summit with the North.

Hyundai cut a deal with the North to spend 50 million dollars of the 400 million dollars to construct a gymnasium in Pyongyang.

The Kim Dae-jung government, however, was found to have let Hyundai Group pay the 1 million dollars that it had promised to pay during the money transfer.

Regarding the nature of the money transferred to the North, the independent counsel said: “The 400 million dollars underwritten by Hyundai Group was considered pre-investment in the North and the 100 million dollars underwritten by then government as a subsidy necessary for North Korea policy. But it cannot be denied the money was linked to the summit given that all the cash was secretly remitted to the North shortly before the summit under the aggressive intervention of the government.” This suggests that the counsel sees the money was paid in return for the summit.

The counsel stressed that the 100 million dollars that the government had promised to pay was a `commission` solely for the summit.

Regarding the suspicion over whether the delayed summit was due to the delayed money transfer, however, the special counsel said, “When Lim Dong-won, then director of the National Intelligence Service, visited North Korea in May 27 and June 3, 2000, the Pyongyang government proposed advancing or postponing the schedule for security reasons and Lim agreed on it.”

On the same day, the counsel indicted former Culture Minister Park Ji-won, who made the pledge at the preliminary meeting for the summit to pay the 500 million dollars to the North on behalf of the government and pressured the state-run Korea Development Bank to extend loans to Hyundai affiliates to help the Group send the money, on charges of abusing his power and violating laws on inter-Korean exchange and cooperation.

The counsel also indicted Hyundai Asan chairman Chung Mong-hun without detention, who cooked the book in order to disguise the transfer of money to North Korea, on charges of fraudulent accounting and violating laws on inter-Korean exchange and cooperation.

Along with this, the independent counsel indicted former NIS Director Lim Dong-won without detention, who helped the illicit money transfer, on charges of violating laws on foreign currency and inter-Korean exchange and cooperation. The indictments of the three men brought the number of figures indicted by the counsel to eight, including Former Korea Development Bank President Lee Keun-young and Hyundai Asan President Kim Yoon-gyu.

Meanwhile, the counsel said, “We confirmed ex-President Kim Dae-jung knew of the money transfer to North Korea but didn`t investigate him because there was no hard evidence of his involvement in illicit acts.”

Jong-Dae Ha Jin-Kyun Kil orionha@donga.com leon@donga.com