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`Roh Loyalist Amassed Millions in Slush Funds`

Posted November. 28, 2008 03:00,   


Park Yeon-cha, one of former President Roh Moo-hyun’s loyal supporters, is alleged to have raised 70 billion to 80 billion won (47 million to 54 million U.S. dollars) in slush funds, according to sources yesterday.

The National Tax Service is believed to have obtained circumstantial evidence that Park, the 63-year-old CEO of Taekwang Industry, amassed slush funds.

Filing a complaint against Park for tax evasion, tax authorities recently submitted its audit results to the Supreme Public Prosecutors` Office. The report reportedly contains considerable evidence suggesting how the slush funds were created and spent.

The tax watchdog and prosecutors said former President Roh Moo-hyun’s aides and ruling camp figures from back then might have received the funds to finance election campaigns. Having secured testimony that the illegal funds might have gone to build and run the village of Bongha in Gimhae, South Gyeongsang Province, where Roh’s private residence is, prosecutors are planning to confirm the statement.

Law enforcement authorities said Taekwang raised the slush funds by creating a paper company that earned profits by selling the sneaker manufacturer’s materials to offshore subsidies in places such as Hong Kong.

Prosecutors yesterday began analyzing the accounting records of the company and summoned tax officials to hear how Park evaded taxes and created the slush funds.

On the alleged bribetaking by the former president’s elder brother Roh Geon-pyeong, prosecutors summoned figures such as the buyer of a store that Roh Geon-pyeong allegedly received from Sejong Securities in return for influence peddling in the sale of the brokerage to Nonghyup Bank.

Prosecutors also secured circumstantial evidence that former Nonghyup CEO Chung Dae-geun lobbied high-ranking officials from the Agriculture and Forestry Ministry (now the Food, Agriculture, Forestry and Fisheries Ministry) to gain approval for Nonghyup’s acquisition of Sejong. Park Hong-soo, former secretary general of the main opposition Democratic Party who passed away in June, was agriculture minister at the time.