YONHAP NEWS

(2nd LD) Special prosecutor clears President-elect Lee Myung-bak

By Kim Hyun
SEOUL, Feb. 21 (Yonhap) -- A special prosecutor cleared President-elect Lee Myung-bak of corruption allegations on Thursday, freeing the CEO-turned politician to push ahead with his promised economic reforms.

Special prosecutor Chung Ho-young concluded that a slew of allegations raised by Lee's opponents, including Lee's role in a 2001 stock manipulation scam, were groundless.

   "The president-elect was found to have no involvement in the stock manipulation," Chung said in a nationally televised press conference.

   The exoneration should enable Lee, set to take office Monday, to push ahead with his key campaign pledges including a controversial canal project and government reform. It will also give an edge to Lee's conservative Grand National Party in the April parliamentary election race.

   "It's a good thing that all the allegations were cleared away again and that the new government can have a fresh beginning," Lee was quoted as saying by his spokesman, Joo Ho-young. "I'd like to return my gratitude by serving the people with a sincere heart and dedicating myself to reviving the national economy."
The independent probe, legislated by liberals affiliated with outgoing President Roh Moo-hyun, kicked off after Lee's landslide election victory in December. Lee had been cleared of the charges in a pre-election probe, but the opponents said the investigation was "biased."
Few expected, however, that the special prosecutor would override the previous findings to declare Lee guilty. He had only 40 days for the politically sensitive investigation, compared to the 105-day mandate given to another special prosecutor now probing the Samsung Group corruption scandal. Also, Chung had no authority to force witnesses to obey summonses, a power usually given to special prosecutors working on complex issues.

   Under such constraints, the investigators did not question key witnesses and conducted just one face-to-face session with Lee.

   At stake in the Lee probe were whether Lee collaborated in the share rigging scam using an investment firm called "BBK"; whether he lied about his wealth; whether the Seoul city government, under Lee's directive, gave a lucrative land deal to an unqualified firm; and whether prosecutors acted properly in vindicating Lee in their earlier probe.

   The special prosecutor reached the same conclusions as the earlier investigators. They indicted Lee's former business partner, Kim Kyung-joon, for stock manipulation, embezzlement of 38 billion won (US$42 million) and forgery. Lee and Kim had jointly set up another Internet investment firm a year before the BBK fraud took place.

   "The crime was committed by Kim Kyung-joon alone. There's no evidence that the president-elect was involved in the embezzlement or shared in the proceeds," Chung said.

   Early this month, a U.S. court ordered Kim, a Korean-American now being tried in Seoul for the BBK fraud, to pay a minimum of US$50 million in compensation to his company's stockholders for their losses resulting from the BBK fraud.

   Questions about Lee's past behavior did not prevent his landslide election victory. With a promise to jumpstart the country's economy, the former Seoul mayor and former CEO of Hyundai Construction & Engineering promised a break with Roh's liberal government that had focused on reconciliation with North Korea and resolving historical issues.

   The liberals had hoped that the investigation into Lee's past would give them an advantage in the April parliamentary elections. That now looks unlikely.

   hkim@yna.co.kr
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