Kim Sung-tae 'Geumgojigi' Detained... Court Cites "Risk of Evidence Tampering and Flight"

[Asia Economy Reporter Kim Daehyun] Kim Mo, former head of the finance division of Ssangbangwool Group and known as the 'treasurer' of former Ssangbangwool Group Chairman Kim Seongtae, was arrested on the 13th. With Kim's detention, the prosecution's investigation into Ssangbangwool Group is expected to gain momentum.

Kim Mo, former head of finance at Ssangbangwool Group, who was the treasurer and brother-in-law of Kim Sung-tae, former chairman of Ssangbangwool Group, detained and indicted on charges including illegal remittance to North Korea, is returning to South Korea through Incheon Airport on the morning of the 11th after nine months of overseas evasion.
[Image source=Yonhap News]

According to the legal community on the 14th, Suwon District Court Judge Kim Kyungrok, in charge of warrants, issued an arrest warrant for Kim, former head of the finance division of Ssangbangwool Group, on charges including violation of the Foreign Exchange Transactions Act for remittances to North Korea, violation of the Capital Markets Act such as fraudulent unfair transactions, embezzlement of company funds, and breach of trust for unfair support to an unlisted company, around 11:20 p.m. the previous day.

Judge Kim issued the arrest warrant after reviewing related records without a hearing procedure, stating, "The criminal charges are substantiated, and there is a risk of evidence destruction and flight." Kim's side also submitted a waiver of the warrant substantive examination to the prosecution, saying, "We will cooperate sincerely with the investigation."

The prosecution is examining the suspicious flow of funds throughout Ssangbangwool Group. They are particularly focusing on clarifying the allegations of 'remittances to North Korea' and 'lawyer fee payments.'

Kim is a figure who has a thorough understanding of the fund flow within Ssangbangwool Group and is regarded as a 'key man' in these allegations. He worked as the head of the finance division at Ssangbangwool Group for over 10 years. He is also the brother-in-law of former Chairman Kim. The prosecution believes he was deeply involved in the remittance process to North Korea. Kim is suspected of being involved in the process of procuring funds for remittances to North Korea from two paper companies (SPCs) established by former Chairman Kim. It is also reported that part of the $8 million (including $5 million for the North Korean smart farm project and $3 million for the Gyeonggi Province governor's visit to North Korea) handed over to North Korea by former Chairman Kim in 2019 was arranged by Kim.

When the prosecution's investigation into Ssangbangwool intensified last year, Kim fled abroad but was arrested in early December last year in Thailand. After refusing repatriation to Korea and engaging in litigation locally, he was fined 4,000 baht (about 150,000 KRW) on the 7th by a local court for illegal stay and other charges, after which he expressed his intention to voluntarily return. Kim was brought back to Korea on the 11th.

The prosecution reportedly conducted intensive questioning of Kim over the past weekend. After his detention, they are expected to probe more detailed matters. The prosecution aims to clarify the source, additional remittances, and purposes of the $8 million that former Chairman Kim reportedly handed over to North Korea through Kim. They are also expected to question the relationship between Lee Jae-myung, leader of the Democratic Party of Korea, and former Chairman Kim.

Former Chairman Kim testified to the prosecution that he had a phone call with Lee Jae-myung, then governor of Gyeonggi Province, through Lee Hwayoung, former Peace Deputy Governor of Gyeonggi Province, who was a channel for inter-Korean business. Both former Deputy Governor Lee and Lee Jae-myung have strongly denied this.

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