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Authorities Raid Korea Railroad Corporation

Posted April. 18, 2005 23:32,   


On April 18, the Seoul District Prosecutor’s Office’s Third Special Investigation Department (Chief Prosecutor: Hong Man-pyo) conducted raids in 12 places. All of the raid targets were institutions involved in the Russian oil-field investment case and the domiciles of those requested by the Board of Audit and Inspection.

The places searched included Korail (Korea Railroad Corporation) in Daejeon, the Korea Rail Traffic Development Foundation in Yongsan, Seoul, Woori Bank’s Namdaemun branch, and the houses of KRC chairman Wang Young-yong and Highend president Jeon Dae-wol.

The prosecutors plan to track and investigate the bank accounts of Jeon, Wang and Kook Energy Development representative Kwon Kwang-jin, who first suggested this project, to see if there has been any illegal transfer of funds.

In addition, the prosecutors also plans to investigate Jeon’s claims that he made a contract with geologist Hur Moon-suk in late August of last year that paid Hur $5 million (about 5 billion won) as a fee for technical advice.

On the whereabouts of Jeon, who has a warrant waiting for him for violating laws on counterfeit checks, a prosecutor’s office official said, “We tracked Jeon’s cellular phone and we have confirmed that he is somewhere in the Seoul Gangnam area.”

Meanwhile, it has been verified that Mr. Hwang (39)--who received the rights to 5.4 billion won of the 8.4 billion won that Jeon earned by selling 154,000 shares of KCO stock to Korail last year September 16--has filed a suit asking for court arbitration against Korail for 101 million won.

Hwang filed a similar suit against Korail last December, demanding 101 million won for part of the stock sold, but Korail rejected the suit on March 18, and the matter is now in trial.

It is known that Hwang has only demanded part of the money due to the costs of the lawsuit, such as fiscal stamp costs, and will take appropriate measures after seeing the results of the lawsuits.

Jin-Young Hwang buddy@donga.com