Gwak Sang-do's Second Warrant Hearing... Attention on Investigation Impact of '50 Billion Club and Daejang-dong Lobby'

Gwak Sang-do Appears in Court... "I Have Nothing to Say"

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

[Asia Economy Reporter Kim Daehyun] Former People Power Party lawmaker Kwak Sang-do (63), accused of facilitating convenience for Daejang-dong developers and receiving bribes through his son, has appeared again for a detention hearing after about two months.

From 10:30 a.m. on the 4th, Judge Moon Seong-gwan, in charge of warrants at the Seoul Central District Court, is conducting Kwak’s pre-trial detention hearing (warrant substantive examination). Upon arriving at the court, Kwak told reporters, "I have nothing to say," before entering the courtroom. He did not respond to questions about whether he denies the additional charges.

Previously, the Seoul Central District Prosecutors’ Office special investigation team (led by Deputy Chief Prosecutor Kim Tae-hoon) filed a detention warrant request against Kwak at the end of last year on charges of accepting bribes under the Act on the Aggravated Punishment of Specific Economic Crimes, but it was dismissed. At that time, Judge Seo Bo-min, in charge of warrants at the Seoul Central District Court, pointed out, "There is room for dispute regarding the establishment of the crime, and it seems necessary to guarantee the suspect’s right to defense. However, the prosecution’s explanation regarding the reasons, necessity, and appropriateness of detention is insufficient."

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

The prosecution initially judged that in 2015, during the early stages of the Daejang-dong development project, when the Hana Bank consortium involving Hwacheon Daeyu Asset Management (Hwacheon Daeyu) was on the verge of collapse, Kwak exerted influence on Hana Financial Group at the request of Kim Man-bae, the major shareholder of Hwacheon Daeyu. As compensation, Kwak’s son, Byung-chae, who worked at Hwacheon Daeyu for about six years, reportedly received 5 billion KRW (2.5 billion KRW after tax) as severance pay, according to the prosecution’s perspective.

A recently publicized recording submitted to the prosecution by accountant Jeong Young-hak, owner of Cheonhwa-dongin No. 5, includes Kim saying, "Byung-chae’s father asks for money. Through Byung-chae," implying that Kwak demanded money through his son.

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

The result of Kwak’s detention hearing is expected as early as late tonight or early morning on the 5th. Whether the prosecution succeeds in securing his custody will be a significant turning point in the ongoing investigation into the so-called "50 billion club" and other Daejang-dong lobbying suspicions involving receiving or promising money from Hwacheon Daeyu.

Meanwhile, at the same court today, the 5th trial of five key figures in the Daejang-dong scandal?including former Seongnam Urban Development Corporation Planning Director Yoo Dong-gyu, Kim, lawyer Nam, and lawyer Jeong Min-yong?is underway from 10 a.m. under the Seoul Central District Court Criminal Division 22 (Presiding Judge Yang Cheol-han). Representatives from Meritz Comprehensive Financial Securities, who participated in the Daejang-dong development project but were not selected as private operators, are appearing as witnesses and are being questioned.

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