Key figure in BBK scandal cleared of election law violations

Prosecutors are known to have made a tentative conclusion Thursday that they cannot pursue Erica Kim for violation of election laws due to the statute of limitations expiring.

She is known as the key figure behind the stock price fraud scandal surrounding the securities company BBK.

In an interrogation at the Seoul Central District Prosecutors’ Office, Kim admitted to spreading false rumors shortly before the 2007 presidential election that the real owner of BBK was then Grand National Party candidate Lee Myung-bak. Given that the six-month statute of limitations expired, however, Kim cannot be prosecuted for election law violations.

Prosecutors said it is difficult to consider Kim’s stay in the U.S. an attempt to avoid prosecution, a precondition for suspending the statute of limitations. Kim could not return to Korea because she was on probation by a U.S. court for three years from February 2008.

The decision is in line with judicial precedents that dismissed action against suspects who returned home after the expiration of the statute of limitations due to their serving prison sentences on foreign soil.

Certain prosecutors say Kim will probably also be cleared of embezzlement and stock price manipulation at Optional Ventures, the predecessor of BBK.

Kim denied the charges, saying, “Stock price manipulation and embezzlement were committed by my brother and I have no relation to them.” In addition, her brother Kim Kyung-joon also told investigators that his sister is not responsible.

Sources also say there is no need to punish Erica Kim because her brother is serving an eight-year prison sentence.

dawn@donga.com