Prosecutors spread Hanbo net wider
Prosecutors spread Hanbo net wider
SEOUL (Reuter): A South Korean court yesterday issued arrest warrants for a close associate of President Kim Young-sam and a top ruling party official over a loan scandal surrounding the failed Hanbo Steel Co, court officials said.
The warrants are for Hong In-gil, a senior official at the presidential Blue House until a few months before he was elected to parliament last year, and Chung Jae-chull, the highest ranking New Korea Party official after Kim and party chairman Lee Hong- koo.
The court issued the warrants only hours after state prosecutors sought them on charges that Hong and Chung had taken kickbacks from Hanbo Group founder Chung Tae-soo.
The tycoon has already been arrested on charges of fraud and other violations in connection with five trillion won (US$5.8 billion) worth of loans the steelmaker piled up before it was declared insolvent on Jan. 23. Two leading local bankers have also been arrested.
Lawmakers Hong and Chung are the first politicians to have been probed over the loan scandal that has shocked South Korea and put the heat on Kim in a presidential election year.
Kim, who last month ordered a probe into the loans, has called the scandal a typical example of corruption.
The two are the first politicians to have been probed over the loan scandal that has shocked South Korea and put the heat on Kim in a presidential election year.
Kim, who last month ordered a probe into the loans, has called the scandal a typical example of corruption.
Prosecutors also questioned the Hanbo founder's driver on Tuesday on suspicions he carried apple crates stuffed with cash to bankers and politicians, senior prosecutor Choi Byung-koog told reporters.
"The driver is a very important person in our investigation," he said.
Hong denied taking money from Hanbo before he was summoned by prosecutors on Monday.
Kwon said he had nothing to do with Hanbo loans. But he has said he took between 150 million and 160 million won from Hanbo, partly to fund an election campaign.
The other lawmaker has not publicly commented.
Prosecutors have summoned Kwon, a top aide to Kim Dae-jung, who heads the main opposition National Congress for New Politics.
But the National Congress and a smaller opposition group, the United Liberal Democratic Party, yesterday urged him not to report to the prosecution office.
"The prosecutors are trying to implicate the opposition to whitewash the nature of the Hanbo incident while trying to cover up real power behind the scene," National Congress spokesman Yun Ho-jung told Reuters.
The National Congress and United Liberal Democrats, which together control 123 of 299 seats in parliament, have alleged government favoritism allowed Hanbo Group to rapidly expand its steelmaking flagship and acquire or set up 18 firms over the past three years.