Expanding Daejang-dong Allegations... Prosecution Investigates Wirye New Town as Well

Key Figures in Daejang-dong Development Confirmed to Be Involved in Wirye... Calls for Investigation into Related Corporations

[Asia Economy Reporters Baek Kyunghwan and Jang Hyowon] The prosecution investigating allegations of preferential treatment in the Daejang-dong development has decided to extend its inquiry to the development process of Wirye New Town. This decision comes after investigations into key figures involved in the Daejang-dong project revealed that verifying any corruption during the Wirye New Town project is necessary to uncover additional lobbying suspicions related to Daejang-dong. However, concerns have been raised that the investigation needs to accelerate, as there are signs that the investment corporations involved in Wirye New Town are going into hiding.

According to legal circles on the 7th, the special investigation team at the Seoul Central District Prosecutors' Office dedicated to the Daejang-dong project allegations focused on confirming whether the summoned individuals were involved in the Wirye New Town development during intensive questioning conducted the previous day.

The Wirye New Town development was a project carried out at the end of 2013 by the private participant 'Pureun Wirye Project,' which supplied 1,137 apartment units on 64,713 square meters. Pureun Wirye Project is a PFV (Project Finance Vehicle), serving as a special purpose company similar to 'Seongnam Eutteul' in the Daejang-dong development. The project structure was also a public-private partnership similar to that of Daejang-dong. The shareholders of Pureun Wirye Project consist of Seongnam Urban Corporation (5%), Wirye Asset Management (13.5%), and financial institutions (81.5%).

The individuals summoned by the investigation team the previous day included Yoo Dong-gyu, former Planning Director of Seongnam Urban Development Corporation, who was arrested on the 3rd, accountant Jung Young-hak who submitted a recording containing lobbying evidence related to Hwacheon Daeyu, and Kim Moon-gi, head of Development Division 1 at Seongnam Urban Development Corporation.

The investigation team suspects that these individuals were actively involved in the Wirye New Town development as well. They believe that lobbying suspicions during the development process extended to the Daejang-dong project. Of the 800 million KRW bribery charges included in Yoo’s arrest warrant, 300 million KRW is related to this matter.

The 300 million KRW is suspected to have been given by Jeong, a major shareholder of 'Wirye Asset Management,' which is considered the Hwacheon Daeyu equivalent in the Daejang-dong project. There are also reports that Jeong threatened to reveal photos of the 300 million KRW bribery given to Yoo and demanded money. The core issue is that Jeong demanded 15 billion KRW from Hwacheon Daeyu major shareholder Kim Man-bae, accountant Jung, and lawyer Nam Wook, and that some of the money was delivered to Jeong.

After the bribery to Yoo was made public, Jeong disappeared, and the investigation team is currently trying to locate him. Since Jeong was listed as a business partner in the Wirye New Town project alongside accountant Jung and lawyer Nam, the team plans to investigate the circumstances surrounding the large sums of money exchanged.

Kim, who underwent intense questioning the previous day, is also one of the figures involved in the Wirye New Town project. In 2016, during a detailed inspection of the 'Pureun Wirye Project' at the Seongnam City Council audit, Kim personally explained questions regarding the board composition, decision-making process, and financing arrangements.

The problem is that the corporations involved in the Wirye New Town development have been erasing their traces following the Daejang-dong controversy. According to our verification, Wirye Partner Samho, which participated as an investor during the Wirye New Town development, has already decided to dissolve according to the corporate registry. The closure date was at the end of December last year.

Some financial institutions that invested through specific money trusts may also be attempting to erase their tracks. Representative examples include Wirye Investment No.1, Wirye Investment No.2, and H Wirye PM. Jeong, the wife of lawyer Nam, who represents Cheonhwa Dongin No.4, served as an inside director of Wirye Asset Management, Wirye Investment No.2, and H Wirye PM. Kim, known as the wife of accountant Jung, is an inside director of Wirye Investment No.1, Wirye Investment No.2, and H Wirye PM.

These corporations, created for the purpose of earning dividend income like the 'Cheonhwa Dongin No.1~7' in Daejang-dong, are registered at the same address as Wirye Asset Management. Hwacheon Daeyu and Cheonhwa Dongin also shared the same address. They reportedly earned about 15.5 billion KRW from the Wirye New Town development. At that time, Pureun Wirye Project distributed a total of 30.6 billion KRW in dividends to investors. Of this, Seongnam Urban Development Corporation received 15.075 billion KRW, and the remaining 15.525 billion KRW went to general investors.

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