Jailed Hanbo boss gave cash to ex-president

Jailed Hanbo boss gave cash to ex-president

SEOUL (AFP): The jailed former head of South Korea's bankrupt
Hanbo Group said on Thursday he had given former president Kim
Young-sam 12.8 million dollars to fund his successful election
campaign in 1992.

The bombshell allegations immediately prompted a furious
rebuttal by Kim, who branded the claims groundless.

"I cannot deny it," former Hanbo head Chung Tae-soo told a
parliamentary hearing when questioned whether he had given 10
billion won ($8.5 million) to the future president in a hotel
room around Dec. 12, 1992.

Chung, 75, who is serving a 15-year prison term for
embezzlement and graft, also alleged that another five billion
won was sent to Kim Young-sam through one of his confidants.

"Bank loans were advanced to finance his (election campaign).
I paid the money in using bank books," he said as he appeared in
parliament wearing a prison-issue robe, a ski cap and surgical
mask against the cold weather.

The ailing former Hanbo executive, who testified from a
wheelchair -- also claimed he provided an additional five billion
won to Kim Young-sam's party on top of the 15 billion won.

Chung's explosive remarks sparked an angry exchange of words
between the ruling coalition and the opposition Grand National
Party, who have been at odds over the ex-president's testimony in
parliament.

The ruling coalition urged the ex-president to appear before
the hearing, which started three week ago to look into the causes
of the economic crisis.

"True or not, we want the ex-president to take the witness
stand," presidential spokesman Park Ji-won said.

But he ruled out any immediate legal steps against Kim Young-
sam, who stepped down in February 1998 at the height of crisis.

"Now the former president has no choice but to appear before
the hearing," the National Congress for New Politics said. "As
former head of state, he should fully account for his
responsibility for causing crisis."

But the defiant ex-president vowed to stay home, calling Chung
a liar. "This is totally groundless," one aide quoted him as
saying.

Kim has persistently denied he accepted a penny from Hanbo,
which collapsed in January 1997 revealing a quagmire of
corruption.

In parliament, however, Chung said he was ready to give a
detailed statement to prove his claim is correct. "I'm too old.
Now I have nothing to hide."

The collapse of Hanbo, once the country's 14th largest
conglomerate, helped precipitate the economic crisis which forced
Seoul to go cap-in-hand for a massive bailout from the
International Monetary Fund in late 1997.

The opposition party described Chung as insane, arguing the
ruling party forced him to make a false confession in return for
his future release from prison.

The GNP held a string of anti-government rallies after
boycotting the hearing into the root causes of the country's
near-financial collapse.

It has denounced the ruling party of using the inquiry as a
political witch-hunt to shatter the opposition.

The ex-president and his son, Kim Hyun-chul, have refused to
appear at the hearing. Kim junior is on bail after being
convicted of influence-peddling and tax evasion.

In earlier court hearings, the son admitted to milking
political funds from businesssmen. But he argued that payouts
were made as political donations with no strings attached.

The son's arrest badly damaged the image of the ex-president,
who put two of his predecessors behind bars on corruption and
other charges.

The Hanbo scandal shook political and business circles,
uncovering a sordid trail of high-level corruption. Along with
Chung, 10 prominent people including lawmakers and bank heads
were put behind bars.

Hanbo's collapse also sparked a chain of corporate failures,
including Kia Motors Corp.

Earlier, ruling party legislators alleged that the ex-
president balked at declaring Kia Motors Corp. bankrupt,
contributing to the crisis.

Analysts believe the delay intensified fears among foreign
investors that South Korea was sweeping its problems under the
carpet, prompting them to collect loans.

Because of Kim's opposition, Kia Motors had to be kept afloat
for 100 days, the ruling party claims.