PROSECUTORS SEEK KWAK SANG-DO’S ARREST

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Prosecutors have sought an arrest warrant for former opposition lawmaker Kwak Sang-do on charges of accepting bribes in the form of severance pay his son claimed from asset management firm Hwacheondaeyu, which is at the center of a land development scandal. He is the first to be requested an arrest warrant among suspects who were allegedly promised 5 billion won related to the development project.

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Prosecutors investigating the Seongnam land development scandal on Monday filed for a warrant to arrest former lawmaker Kwak Sang-do. It comes just 2 days after he was questioned as a suspect. The charge he faces is acceptance of a bribe for mediation. This applies to people who take kickbacks in return for mediating with a financial institution. The prosecution believes Kwak facilitated the formation of a Hana Bank consortium which also included Hwacheondaeyu, and in return received 2.5 billion won via his son. The son is known to have claimed a 5 billion won severance pay from the asset management firm but the warrant request indicated the after-tax amount received was 2.5 billion. Prosecutors suspect that when Hana Bank was about to break away from the consortium in 2015 ahead of bidding for the Daejang-dong project Kwak, at the request of Hwacheondaeyu's largest shareholder Kim Man-bae, asked his university peer and Hana Financial Group chairman Kim Jung-tai to make the consortium deal work and not fall apart. Last Saturday, Kwak was summoned for the first time and was grilled for 17 hours. Following the warrant request, the former lawmaker issued a statement, again denying the allegations. He said the warrant lacks specific details such as what request he received and what kind of favor he asked on whom. Kwak vowed to prove his innocence in court. The Seoul Central District Court will deliberate and decide on the warrant issuance Wednesday. The investigation is expected to pick up speed regarding lobbying allegations involving politicians including suspicions over the so-called 5 billion won recipients club.