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“The 12 Billion Won Was Just Money for Business Operations”

“The 12 Billion Won Was Just Money for Business Operations”

Posted May. 01, 2005 23:42,   


It was revealed yesterday that the Korea National Railroad (KNR), the predecessor of the Korea Railroad (Korail), which stands at the heart of a Russia oil development scandal, considered backing off from the project before sending a deposit ($6.5 million) last October because it had already recognized some problems with the project.

Wang Young-yong, a Korea railroad director who was largely involved in this project, pushed ahead with the plan without considering requests from other workers for further examination on its feasibility before sending the deposit, even going so far as to completely cut them from other business involved in the project.

The Seoul District Public Prosecutors’ Office (DPPO) Special Investigation Department III (Chief Prosecutor Hong Man-pyo) put Wang under arrest last Saturday on the charge of misfeasance in office, according to the Act on Aggravated Punishment for Specific Economic Crimes.

The DPPO also revealed that on September 30, 2004, five days before the KNR sent the deposit to Russia, 17 executive members had a meeting which was presided over by Shin Gwang-soon, then the vice chief in the KNR, to review on whether to continue the project or not. The meeting took place five days before the contract money was sent to Russia.

At this meeting, some members pointed out the high risk of this project on the basis of outcomes presented by working-level officials who had conducted an investigation in Russia. Their five-day investigation trip started on September 22.

According to materials Dong-A Ilbo obtained about this meeting, the majority of members, at first, were in favor of dropping the project. However, Wang delivered wrong information, saying, “We can take the contract back if we recognize the project is not profitable after conducting a precise inspection.”

In the end, the members agreed to continue the project as Wang called for, said prosecutors.

However, a closer look at the information from the prosecution’s investigation on Wang indicates that this incident seems be different from the “ordinary power-related ‘-gate’ scandal.”

This is because throughout almost the entire process, including the project’s start, evaluating the project’s feasibility, and the aftermath caused by the project falling through, Wang’s lies have been dictated.

“Korail workers say that this is a result of Wang’s personal aspirations,” said a source from the prosecution.

In addition, the prosecution also said that even though, in regards to the 12 billion won in funds, there had been some who said that it was funds for lobbying, Wang said, “The money is not to be used for lobbying politicians, but for the operation of the oil development project.”

However, it has also been heard that what Jeon Dae-wol, head of the real estate firm, really said during the prosecution’s questioning about the introduction of Rep. Lee Gwang-jae of the ruling Uri Party to geologist Huh Moon-suk is somewhat different from what people commonly know.

As for now, until Huh returns to the country, it is highly unlikely that the complex scenarios surrounding the involvement of political figures in this scandal will be untangled.

The prosecution plans to summon Park Sang-jo, then-head of the Card Operation Headquarters at the Korea Rail Traffic Development Foundation, today. Park was also greatly involved with the oil development project along with Wang

Moreover, the prosecution plans to summon Kim Se-ho, the vice minister of Construction and Transportation, and Shin Gwang-soon, the president of Korail sometime this week and question them about why they let the project continue despite their acknowledgement of the high risk of the project.