Firm head denies wrongdoing, calls for travel ban to be lifted
Special prosecutor requests National Tax Service records on bid-rigging suspects
The special prosecutor investigating the National Election Commission — including the ballot shortage that emerged during the June 3 local elections and a range of other alleged irregularities — has recently questioned the head of an election-supply company as a suspect, pressing on whether the firm issued false tax invoices. The company denies the allegation, saying the invoices were properly issued.
The special prosecutor's team summoned the head of a North Gyeongsang Province-based election-supply company, identified only as A, for questioning as a suspect on Monday, probing whether the firm had issued false tax invoices. A had previously been booked on charges of obstructing bidding.
A serves as an inside director at a separate North Gyeongsang Province-based election-supply company headed by A's spouse, identified as B. Investigators are looking into whether A installed B as a front company head and engaged in misconduct while entering into contracts with the National Election Commission. The company run by B also had as an executive a former NEC political parties division chief, identified as C, who is also under investigation as a suspect in connection with an election-supply firm.
During questioning, investigators pressed A on whether the company had issued false tax invoices. A denied the allegation during the session, according to sources. A told The Herald Business: "The tax invoices were issued properly. The special prosecutor is conducting an overly aggressive investigation, and the travel ban is disrupting my business. The ongoing travel ban extension must be lifted."
On Oct. 18, the special prosecutor's team announced it had found signs of violations of the Punishment of Tax Evaders Act while investigating companies suspected of bid-rigging and preferential no-bid contracts tied to the NEC. The team said the companies appeared to have conducted fictitious transactions with front companies — sharing profits or evading taxes — and to have issued and received false tax invoices. The team said it had asked the National Tax Service to provide relevant records.
Because charges under the Punishment of Tax Evaders Act require a complaint from the commissioner of the National Tax Service or another designated authority before an indictment can be filed, the special prosecutor's team asked the NTS on Oct. 16 to investigate the alleged fictitious transactions and false tax invoice issuance and receipt, and to return its findings and supporting materials. The team also asked for a faster-than-usual turnaround given the investigation's time constraints.
Articles 7(3) and 7(5) of the NEC Special Prosecutor Act allow the special prosecutor to request cooperation from the heads of relevant agencies — including the submission of case-related investigation records, evidence and other materials, as well as investigative support — when necessary for carrying out official duties, and require those agency heads to comply. The special prosecutor's team said it plans to receive the materials within the investigation period and then decide whether to seek indictments against the companies involved.
Beyond the contract irregularities, the special prosecutor's team is investigating 12 areas of alleged misconduct, including the ballot shortage, manipulation of election statistics, and allegations that former NEC Chairman Noh Tae-ak took junkets disguised as official overseas trips. In connection with the ballot shortage, the team conducted a verification of 2.47 million ballots from Songpa-gu stored at the handball arena in Olympic Park in Songpa-gu, Seoul, on Wednesday and Thursday.
On the election statistics manipulation allegations, the team has expanded to 36 the number of local jurisdictions suspected of entering false hourly voter turnout figures into the election management system and the vote-counting reporting system. The joint police-prosecution task force that preceded the special prosecutor had initially identified five such jurisdictions; the special prosecutor's team added 25 more after launching, and has recently added six more — Chungju in North Chungcheong Province, Nonsan in South Chungcheong Province, Masan Happo in Changwon, South Gyeongsang Province, Masan Hoewon in Changwon, Sangju in North Gyeongsang Province, and Gangneung in Gangwon Province.
In connection with the junket allegations, the team executed a search and seizure warrant on Tuesday at the residence of former NEC Chairman Noh on charges of occupational embezzlement and the preparation and use of false official documents. The earlier joint task force had also sought a warrant to search Noh's residence, but a court rejected it once. The special prosecutor's team subsequently secured additional materials, obtained a new warrant and carried it out.
The special prosecutor's team, which launched on Sept. 7, has a base operating period of 90 days. Under the special prosecutor act, if the investigation cannot be completed or a decision on indictment cannot be reached within that period, a single 30-day extension is permitted. If the investigation remains unfinished after that extension, the special prosecutor may report the reasons to the president and, upon approval, seek one additional 30-day extension.
Having passed the 50-day mark, the team is weighing whether to secure custody of suspects in the various cases while moving to accelerate its questioning of former Chairman Noh, who sits at the center of the allegations.
bell@heraldcorp.com
