Prosecutors Intensify Investigation into 'Rhyme Incident'... Arrests of Other Chairpersons Are Key

Lee Jong-pil followed by Kim Bong-hyun soon to the prosecution... Investigation reaching its peak
Prosecutors focusing investigative efforts on tracking key figures not yet apprehended

[Image source=Yonhap News]

[Asia Economy Reporter Yoo Byung-don] As the prosecution has succeeded in securing the custody of key figures considered the 'masterminds' behind the Lime Asset Management scandal, the investigation into the case, which caused a redemption suspension crisis worth 1.6 trillion won, is rapidly approaching its peak.

As the prosecution intensifies its investigation into these individuals, it appears to be making every effort to secure the custody of other important figures who have not yet been apprehended.

Prominent figures include Kim, chairman of Metropolitan, Kim, chairman of Lead, and Lee, chairman of Esmo, all of whom received investments from Lime. Metropolitan’s Chairman Kim is currently subject to an Interpol red notice on charges of embezzling a significant portion of Lime’s funds. Another Kim, known as the actual owner of Lead, is a figure who provided large sums of money to former Lime Vice President Lee Jong-pil, who is in custody, and received 50 billion won in investment from Lime. Esmo’s Chairman Lee acquired another KOSDAQ-listed company through Esmo, received 200 billion won in investment from Lime, took out loans using his shares as collateral, and then disappeared.

Along with former Star Mobility Chairman Kim Bong-hyun, who was detained on the 26th, former Suwon Passenger Finance Director Kim, suspected of involvement in the Suwon Passenger embezzlement case, is also a target for custody. He is reported to be on the run, mainly in China.

On the 26th, Judge Han Woong-hee of the Suwon District Court held a pre-arrest detention hearing for former Chairman Kim Bong-hyun and issued an arrest warrant, citing concerns over evidence destruction and flight risk. He is accused of embezzling 24.1 billion won from Suwon Passenger company funds, as well as various investments from Lime funds, and leading corporate raids.

Former Vice President Lee Jong-pil and former Shinhan Financial Investment PBS Business Division Team Leader Shim were also arrested on the 25th on charges including violation of the Act on the Aggravated Punishment of Specific Economic Crimes (bribery). Former Vice President Lee is accused of receiving luxury watches, bags, and high-end imported cars from Lead, a KOSDAQ-listed company invested in by Lime, as a return for investments.

[Image source=Yonhap News]

All of these individuals are considered the masterminds behind the current Lime scandal. Former Vice President Lee Jong-pil is identified as the leader in the embezzlement case involving KOSDAQ-listed Lead, as well as inflating the returns of failing funds. Former Chairman Kim Bong-hyun is known as the financier behind Lime and is believed by the prosecution to have been deeply involved in fund management. Kim Bong-hyun is also at the center of allegations involving lobbying of political and government figures, including former Blue House administrator Kim, who is known to be a childhood friend.

The Intelligence Crime Investigation Unit of the Gyeonggi Southern Provincial Police Agency, currently investigating Kim Bong-hyun’s embezzlement of Suwon Passenger funds, plans to complete the investigation as soon as possible and transfer his custody to the prosecution. The Criminal Division 6 of the Seoul Southern District Prosecutors’ Office (Chief Prosecutor Jo Sang-won), which is in charge of the overall Lime investigation, plans to investigate these individuals for criminal charges related to the Lime scandal.

According to the interim investigation results announced by the Financial Supervisory Service in February, Lime repeatedly engaged in 'circular financing,' where it used funds from other funds to acquire non-performing assets in order to prevent losses in specific funds, thereby passing losses onto other funds. The prosecution is expected to focus its investigation on whether former Vice President Lee Jong-pil conspired with Kim Bong-hyun and others to embezzle funds from companies invested in by Lime and whether they colluded with stock price manipulation groups to obtain illegal profits.

This content was produced with the assistance of AI translation services.