Video Gambling Lobbying Links Probed

It was confirmed that the Korea Amusement Industry Association (KAIA), an organization for arcade game-related manufacturing, distribution and companies, received a fund of some two billion won as 19 issuers of gift certificates used for gambling arcades simultaneously joined the association in April. This is raising suspicion as it may possibly have been used in lobbying government officials.

The KAIA had funded 100 million won to the Busan Digital Culture and Arts Festival where Grand National Party lawmaker Park Hyeong-joon headed the festival’s organization committee, and the spotlight is now pointing on the whereabouts of the rest of the money.

A president of a member company to the association met with a Dong-A reporter on August 25 and said, “The association requested some three billion won to be made, and it seems that two billion has already been made.”

A president of another arcade company said, “Word that the gift certificate issuers collected three billion won at the association and are using it for lobbying funds have been widely spread among our business field.”

Regarding this, a senior official of the association said, “The issuers have raised two billion won by accumulating one won for each gift certificate worth 5,000 won,” admitting the fact of fund-raising. However, he explained that it was collected as a membership fee rather than lobby funds.

The KAIA is formed of some 70 companies in the manufacturing, distribution and operation of the arcade business, and was established in January of this year. 19 issuers of gift certificates for game arcades including Happy Money Inc, Korea Education Culture Promotion and Secutec concurrently joined the association.

The association was known to have high possibilities in undertaking the technical deliberation of game machines following the enforcement ordinance of the game industry promotion act to take effect in October. As the association was the only one under the Ministry of Culture and Tourism (MCT) to be related to manufacturing game machines, it is expected to benefit highly from the new act.

It also turned out that high executives of KAIA all had close relations with MCT. KAIA president Jeong Yeong-soo had been the president of Korea Game Development & Promotion Institute (KGDI), an organization under the MCT, from April 2002 to February 2004.

Kim Yong-hwan, the registered director of KAIA and CEO of Andamiro, a gift certificate issuing company, worked as a director of KGDI in February 2003 and is known to have close acquaintance with Jeong.

An official in the game business said, “The figures heading the association are all ‘big shots’ in the arcade business. That is probably why many gift certificate issuers joined the association, to benefit from them.”

Meanwhile, it was revealed that the Eastern Branch of Seoul District Public Prosecutors’ Office received a secret report from the Supreme Prosecutors’ Office that 19 gift certificate issuers raised an enormous amount of money and attempted to lobby through former high-ranking officials of the Korea Computer Game Industrial Association and investigated into the case last December.

A prosecution official said, “Based on this report, the prosecutors were issued search warrants on some of the gift certificate companies, but the suspicions for lobby were not confirmed.”

dnsp@donga.com will71@donga.com