Police Near Conclusion on Lee Jae-myung in 'Seongnam FC Suspicion'... Donation Usage Unclear

[Image source=Yonhap News]

[Asia Economy Reporters Seongpil Jo and Sehee Jang] On the 13th, it was reported that the police investigating the 'Seongnam FC sponsorship fund suspicion' decided to hand over the case of Lee Jae-myung, leader of the Democratic Party of Korea, to the prosecution on charges of third-party bribery. This conclusion comes seven months after the prosecution requested supplementary investigation in February. However, it is reported that the police ultimately failed to resolve all suspicions regarding the use of the sponsorship funds, which had been the focus of their investigation.

According to a comprehensive report by this outlet, the Anti-Corruption Economic Crime Investigation Unit of the Gyeonggi Southern Provincial Police Agency is expected to hand over the investigation results on Lee to the prosecution as early as today. The police reportedly judged that Doosan Construction paid about 5 billion KRW in sponsorship funds to Seongnam FC as a bribe in exchange for changing the use of hospital land it owned in 2015 to office facilities and reducing the area to be donated from 15% to 10%. Earlier, Seongnam City approved the change of use for the hospital land promised through a business agreement in July 2015 during Lee’s tenure as mayor in November of the same year.

Doosan Construction provided a total of 5.3 billion KRW in sponsorship funds to Seongnam FC, starting with 2 billion KRW in 2016, followed by 2.2 billion KRW in 2017, and 1.1 billion KRW in 2018. Prior to this, Doosan Construction had only donated about 300 million KRW to Seongnam FC in March 2015. After the approval of the change of use, the annual sponsorship amount increased by up to seven times. Doosan Construction built a new headquarters on the changed land, and from 2019, when Lee left for the position of Gyeonggi Province governor, no separate sponsorship funds were provided.

This investigation result contrasts with the decision by the Bundang Police Station in Gyeonggi Province last September to dismiss the case against Lee due to insufficient evidence. The Bundang Police Station had concluded no charges after investigating for three years and three months since June 2018, following a report by the Bareunmirae Party during the local elections that year. Subsequently, the accusers filed an objection to the police investigation results, and the case was transferred to the prosecution. The prosecution requested supplementary investigation, and the police started reinvestigation in February this year.

[Image source=Yonhap News]

Initially, the supplementary investigation was handled by the Bundang Police Station. At that time, the Bundang Police Station received support from five investigators from the higher authority, the Gyeonggi Southern Provincial Police Agency, focusing on tracking the flow of funds and whether there was quid pro quo in the Seongnam FC sponsorship funds. During this process, it was confirmed that Doosan Construction sent an official letter to Seongnam City in October 2014 stating, "If the use of the hospital land is changed to allow building a new headquarters, we will sponsor Seongnam FC." In relation to this, the police conducted a surprise raid on Seongnam FC and Doosan Construction headquarters in May and reportedly found documents proving Lee’s guilt while analyzing the secured materials. Around this time, the case was transferred to the Gyeonggi Southern Provincial Police Agency, and the investigation was nearing its conclusion.

However, the police reportedly failed to clarify the exact use of the sponsorship funds. The police had focused their investigation on the unclear use of sponsorship funds received by Seongnam FC from companies such as Doosan Construction. The investigation stemmed from suspicions that part of the sponsorship funds was laundered and used as election funds for Lee. If the investigation had revealed any withdrawal of funds by Lee or his associates, charges of embezzlement could have been applied. These suspicions were also specified in the accusers’ objection letter.

In fact, the police examined the use of funds through materials secured during the May raid and confirmed that part of the sponsorship funds was paid as performance bonuses. However, it was judged that the performance bonuses were not problematic as they were paid according to Seongnam FC’s revenue performance bonus policy, which allows up to 20% bonuses to employees and public officials who contributed to attracting sponsorship funds. Previously, Seongnam FC had not disclosed details of who received performance bonuses and how much, despite requests for information from the Seongnam City Council and others.

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