Kim's son cleared of Hanbo suspicions

Kim's son cleared of Hanbo suspicions

SEOUL (Reuter): South Korean prosecutors cleared President Kim
Young-sam's son yesterday of any wrongdoing in connection with a
loan scandal surrounding the failed Hanbo Steel Co.

Senior prosecutor Choi Byung-koog told reporters that Kim
Hyun-chul was sent home after being cleared of all suspicions in
connection with huge loans to Hanbo Steel Co, flagship of South
Korea's 14th largest conglomerate.

"We could not find any wrongdoing by Kim Hyun-chul," Choi
said. "He denied all suspicions except for a couple of meetings
with two sons of the Hanbo Group founder Chung Tae-soo."

An emotional Kim Hyun-chul apologized for any controversy that
involved him. He has said he played no role in the scandal.

"I am very sorry for inadvertently causing anxiety to the
people and my father," he said before leaving the prosecution
building.

Kim Hyun-chul, the president's second son, was questioned
after he lodged a criminal libel complaint on Tuesday against six
opposition politicians who alleged he pressured banks to offer
loans to Hanbo Steel. The steelmaker racked up US$5.8 billion in
loans before being declared insolvent on Jan. 23.

Senior prosecutor Choi said the six politicians from the main
opposition National Congress for New Politics would be summoned
soon for questioning over the libel complaint.

The six include party spokesman Chung Dong-young, his deputy
Sul Hoon and three other members of parliament.

Choi said Hyun-chul had denied the politicians' allegation
that he received donations in return for pressuring banks to
extend loans to the troubled steelmaker.

Hyul-chul told investigators he had simply met two sons of the
Hanbo founder on social occasions but had no other ties with
them.

A recent survey by a monthly news magazine showed 66 percent
of 1,068 people polled believed Kim Hyun-chul was involved in the
Hanbo scandal, and 70 percent thought President Kim himself
should be investigated over the case if necessary.

The survey by WIN magazine showed that about 73 percent of
those polled believed the president's reform policies had failed.
Kim Young-sam launched an anti-corruption drive as his top reform
policy shortly after taking office in 1993.

"The aftermath of the latest scandal involving National
Assemblymen and administration officials will make it difficult
for President Kim to maintain his credibility for the remainder
of his term," the Korea Herald said in an editorial.

President Kim, whose single five-year term expires early next
year, is due to make a statement next week on the political
situation, government officials said.

Speculation that Kim Hyun-chul had close ties with Hanbo was
fanned by the discovery last week of more than 10,000 copies of a
book written by him in a Hanbo Group warehouse in Seoul.

The opposition has said the books found in the warehouse
proved that Hanbo had been a sponsor of Kim Hyun-chul but
prosecutors said most local conglomerates had bought his books.

On Wednesday, prosecutors indicted 10 people in the scandal,
including Hanbo Group founder Chung and three close associates of
the president, on bribery and embezzlement charges.

But opposition parties have demanded a new probe, saying
prosecutors have failed to uncover the "real big hands" in the
scandal. Both the National Congress and the United Liberal
Democratic Party have called for special legislation to allow
independent prosecutors to restart the probe.