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South Korea: Conglomerates Involved in Slush Scandal

BBC
December 15th, 2003

The man who narrowly lost last year's presidential race in South Korea has admitted his campaign finances included $42m in illegal donations.

Lee Hoi-chang, of the Grand National Party, made the admission in a televised news conference, then turned himself in to state prosecutors.

The shock statement is the latest twist in a scandal which also threatens President Roh Moo-hyun, since four former aides have been implicated.

Mr Roh said he would resign if his party is found to have taken one tenth as much in illegal funding as the GNP.

Mr Lee said on Monday that his party had taken 50 billion won ($42 million) in illegal funds from business conglomerates.

The legal maximum fixed for last year's campaign was 34.1bn won ($28.8m) per candidate.

"I confess this was done under my charge and I'm entirely responsible for this," the GNP's former leader told reporters.

The former Supreme Court justice, who retired from politics after his defeat by Mr Roh, said it was only right he should "take all the responsibility and punishment", adding that he was ready to go to jail.

State prosecutors arrested Mr Lee's key legal adviser, Suh Jong-woo, last week on charges of taking illegal donations from conglomerates.

The scandal is also becoming increasingly damaging for President Roh.

On Sunday, prosecutors arrested Ahn Hee-Hung, who served as a campaign manager for Roh, on charges of accepting illegal political donations.

A former confidant of Mr Roh's, Choi Do-sool, was arrested in October on charges of taking US$956,000 in bribes from SK, the nation's third-largest conglomerate.

Two other aides, Lee Kwang-jae and Yang Gil-seung, are under investigation for taking bribes.

Several of South Korea's major conglomerates have had their offices raided in connection with the scandal.

An independent inquiry is probing the issue, after the South Korean legislature over-rode Mr Roh's attempt to veto the investigation.

Mr Roh said on Sunday that he would step down if the inquiry found that his aides took more than a fraction of that taken by the GNP.

"If the amount of our illegal funds is more than one-tenth of the Grand National Party's, I will resign from my presidential post and retire from politics," he said.





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