First complainant questioned Friday; nominee faces additional complaint over capital markets law violations
Police investigations into a string of allegations surrounding Kim Seung-won, the nominee for justice minister, continued through the weekend. According to police, the Seoul Yeongdeungpo Police Station questioned Lee Jong-bae, a former Seoul Metropolitan Council member who had filed a complaint against Kim on Friday, accusing him of abuse of authority, dereliction of duty and violations of the Anti-Graft Act. It was the first time a complainant in the case had been formally questioned.
Before the questioning, Lee said investigators needed to determine whether Kim had pressured the Ministry of Food and Drug Safety into approving clinical trial applications based on falsified or fabricated documents.
Lee alleged that Kim had exerted influence over then-Ministry of Food and Drug Safety Commissioner Kim Gang-rip during the 2021 approval process for Genencell's COVID-19 treatment clinical trial. Lee also filed complaints against the former commissioner and other ministry officials.
The following day, Saturday, Yeongdeungpo police summoned Kim Sun-hwan, secretary-general of a civic group focused on ordinary citizens' livelihoods, who had filed a separate complaint against the nominee alleging violations of the Political Funds Act and the Anti-Graft Act.
On Sunday, police questioned Democratic Party of Korea lawmaker Kim Dong-a, who had filed a complaint over allegations that investigative materials related to the nominee had been leaked. Kim Dong-a had filed a complaint against independent lawmaker Han Dong-hoon on Sept. 7, alleging he leaked those materials.
Han had earlier claimed that prosecutors investigating the improper lobbying allegations for clinical trial approval had been subjected to outside pressure and had given Kim Seung-won a suspended indictment. Han publicly released a prosecution plan reportedly drafted by the investigative team at the time.
'Awareness of possible fraudulent trading under capital markets law'
The police investigation surrounding the nominee is expanding. Lee filed an additional complaint against Kim with the Seoul Metropolitan Police Agency on Monday morning, this time alleging violations of the Capital Markets Act. The case is likely to be referred to Yeongdeungpo police as well.
In the complaint, Lee alleged that Kang, the founder of Genencell, had agreed to receive investment from a broker surnamed Yang on the condition that clinical trial approval would be secured, and had asked Yang to use political connections to expedite the approval. Lee further alleged that Yang approached Kim Seung-won, mentioning plans to raise 30 billion won ($22.3 million) in investment and prepare for a stock listing, and asked him to help secure the approval.
Lee also alleged that Yang told Kim the approval could benefit future election campaigns once the funds were secured, and that Kim himself remarked that the clinical trial approval could be worth "hundreds of billions of won."
Lee argued that if Kim had been aware of the impact the clinical trial approval would have on Genencell's corporate value and share price, and had still lobbied the food and drug safety minister for approval after learning of the major shareholder's plans to sell shares and monetize holdings, he could be seen as having been aware of the possibility of fraudulent trading under the Capital Markets Act.
"Kim claims his illegal lobbying was a public interest petition, but this was an unprecedented share manipulation scheme that left 30,000 investors in tears," Lee said, urging a thorough investigation.
Lee had signaled his intention to file the additional complaint when he spoke to reporters ahead of his questioning on Friday, saying he would first confirm what role Kim had played in the alleged share manipulation involving Genencell before proceeding.
Police said they plan to establish the facts based on complainants' statements and related materials.
newday@heraldcorp.com
