Police Summon Jang Ha-won for Second Investigation Regarding 'Discovery Fund'

Investigation Underway Since Morning of the 11th... Expected to Continue Until Late Afternoon

Seoul Metropolitan Police Agency file photo / Photo by Moon Honam munonam@

[Asia Economy Reporters Yoo Byung-don and Oh Gyu-min] Jang Ha-won, CEO (63) of Discovery Asset Management (Discovery), who is at the center of the ‘Discovery Fund Redemption Suspension’ case, has been summoned by the police again.

The Financial Crime Investigation Unit of the Seoul Metropolitan Police Agency is investigating Jang, who is suspected of fraud under the Act on the Aggravated Punishment of Specific Economic Crimes and violations of the Capital Markets Act, on the morning of the 11th. This is the second summons following the first investigation on the 9th.

The police believe that Jang used a so-called ‘Ponzi scheme’ method, where in the absence of profits from fund sales, investment money from new investors was paid to existing investors as returns, and they are closely examining this aspect.

Additionally, the police reportedly discovered evidence from PC files seized during a raid on Discovery’s office in July last year, indicating that Jang’s older brother, Jang Ha-sung, the Ambassador to China, and his spouse invested approximately 6 billion KRW in 2017, and Kim Sang-jo, former Chief of the Blue House Policy Office, invested about 400 million KRW. Based on this, it is presumed that the investigation will focus on whether these influential figures received special benefits such as compensation for fund losses.

The Discovery Fund was sold through commercial banks and securities firms such as Hana Bank and IBK Industrial Bank of Korea between 2017 and 2019. According to the Financial Supervisory Service, as of the end of April last year, the total outstanding balance that banks and others failed to repay due to redemption suspension amounted to approximately 256.2 billion KRW.

Jang Ha-won is the younger brother of Jang Ha-sung, Ambassador to China and former Chief of the Blue House Policy Office, and established Discovery Asset Management in 2016.

Earlier, in July last year, the police banned Jang from leaving the country and conducted raids on Hana Bank, IBK Industrial Bank of Korea, Korea Investment & Securities, and Hana Financial Investment, which sold the Discovery Fund.

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