Gwak Sang-do, Suspected of 'Son's 5 Billion Won Retirement Pay,' Faces Second Arrest Decision Today

Prosecutors Seek to Secure Momentum in Investigation of 'Daejangdong Lobby' Allegations

Former People Power Party lawmaker Gwak Sang-do [Photo by Yonhap News]

[Asia Economy Reporter Kim Daehyun] The second pre-trial detention hearing for former People Power Party lawmaker Kwak Sang-do (63), who has been embroiled in controversy for his son receiving a large retirement payment from Hwacheon Daeyu Asset Management (Hwacheon Daeyu), is set to take place. This comes about two months after the first warrant was dismissed at the end of last year.

At 10:30 a.m. on the 4th, Judge Moon Seong-gwan, in charge of warrants at the Seoul Central District Court, is scheduled to conduct Kwak’s second detention hearing. The decision on detention is expected to be made either later that afternoon or early on the 5th.

Previously, the dedicated investigation team at the Seoul Central District Prosecutors’ Office (led by Deputy Chief Prosecutor Kim Tae-hoon) filed a detention warrant against Kwak at the end of last year on charges including bribery under the Act on the Aggravated Punishment of Specific Economic Crimes, but it was dismissed.

At that time, Judge Seo Bo-min, also in charge of warrants at the Seoul Central District Court, stated the dismissal was due to "disputes over the establishment of the crime and the need to guarantee the suspect’s right to defense, while the prosecution’s explanation regarding the reasons, necessity, and appropriateness of detention was insufficient."

Subsequently, the dedicated investigation team conducted supplementary investigations and on the 25th of last month refiled the detention warrant, adding charges of bribery under the Act on the Aggravated Punishment of Specific Crimes and violations of the Political Funds Act.

The prosecution believes that in early 2015, when the Hana Bank consortium involving Hwacheon Daeyu was at risk of collapse during the Daejang-dong development project, former lawmaker Kwak exerted influence on Hana Financial Group at the request of Kim Man-bae (detained and indicted), the major shareholder of Hwacheon Daeyu.

Kwak is suspected of having his son, Byung-chae, who worked at Hwacheon Daeyu for about six years, receive approximately 2.5 billion won (before tax 5 billion won) as retirement pay in return for such a favor.

The warrant also newly includes allegations that around April 2016, when Kwak was elected as a member of the National Assembly through the 20th general election, he received illegal political funds amounting to 50 million won from lawyer Nam Wook (detained and indicted), owner of Cheonhwa-dongin No. 4, a subsidiary of Hwacheon Daeyu.

The decision on Kwak’s detention is expected to be a turning point in the ongoing investigation into the so-called "50 billion club" and other Daejang-dong lobbying suspicions involving receiving or promising money or favors from Hwacheon Daeyu.

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