[Invest&Law] Prosecutor Impeachment Fallout Slows Corruption Investigations: Companies Hold Their Breath Amid “Bigger Storm Coming”

Seoul Central District Prosecutors' Office. Yonhap News Agency

As the prosecutor impeachment crisis prolongs, the key leadership positions at the Seoul Central District Prosecutors' Office, including Lee Chang-soo, Chief Prosecutor of Seoul Central District (53, Judicial Research and Training Institute class 30), Jo Sang-won, 4th Deputy Chief Prosecutor (52, class 32), and Choi Jae-hoon, Head of the Anti-Corruption Division 2 (49, class 34), have become vacant, leaving corporate corruption investigations at the Seoul Central District Prosecutors' Office effectively at a standstill. While investigations have temporarily paused, allowing companies burdened with judicial risks to catch their breath, the atmosphere remains tense as they continue to closely monitor the prosecutors' movements.

At frontline prosecutors' offices including the Seoul Central District Prosecutors' Office, numerous complaints and accusations are piled up involving suspicions of preferential treatment of business, unfair support to affiliates, and allegations of slush funds and tax evasion by corporate heads. Although cases have been assigned, investigations have not progressed properly.

Besides the impeachment led by the Democratic Party of Korea, the investigation related to the December 3 martial law has caused the prosecution to lose momentum in corporate corruption investigations. Except for the real estate PF loan corruption case, which was nearing completion after the impeachment motion against Lee Chang-soo, Chief Prosecutor of Seoul Central District, in December last year, ongoing investigations have effectively come to a halt. A prosecutor at the Central District Prosecutors' Office lamented, "Without a chief prosecutor, it is practically difficult for investigation teams to operate independently. The leadership's role is essential, especially for large-scale cases," expressing the difficulties caused by the leadership vacuum.

Major investigations at the Seoul Eastern District Prosecutors' Office, such as the case against Coupang for violating the Fair Trade Act and the SK-Alchemist transaction suspicion case, have also effectively stopped. The Coupang algorithm ranking manipulation case has seen no significant progress since the office raid, and the SK-Alchemist case reportedly has not undergone further investigation since case assignment.

Some companies have temporarily breathed a sigh of relief due to the investigation delays, but remain on high alert. This is because not only the assigned cases but also corporate corruption cases reported by the National Tax Service, Financial Supervisory Service, and Fair Trade Commission still remain on the prosecutors' desks. A lawyer who is a former chief prosecutor said, "Large-scale corporate investigations require organized judgment and strategy, so in the absence of leadership, the pace can only be adjusted. Once the command system is reorganized, the investigation momentum will resume."

Woo Bin, Legal Times Reporter

※This article is based on content supplied by Law Times.

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