The prosecution raided the headquarters and several affiliates of Ssangbangwool Group on Monday. The group allegedly handed dollar bills worth tens or thousands of millions of won to each of about 60 employees and made them take flights to China in 2019 with the money.
When a Korean takes foreign currency in excess of $10,000 out of the country, he or she must declare it to customs, but the Ssangbangwool employees did not. They are said to have concealed dollar bills inside books, cosmetic cases or other personal belongings.
If the use of the money had been normal or legal, they would have had no reason to do so. The prosecution is tracing the whereabouts of the smuggled money.
The employees went in and out of Shenyang Taoxian International Airport scores of times. Within the airport, they are said to have delivered the money to Ssangbangwool's vice chairman and taken flights home shortly afterward. They were simply couriers.
Their departures for Shenyang, China, were concentrated in January and November 2019.
Prosecutors are paying attention to the fact that Ssangbangwool made agreements with North Korea around the time when the money was smuggled out through its employees.
At that time, Ssangbangwool, along with Gyeonggi Province, was pushing business projects with North Korea.
Kim Sung-tae, former chairman and de facto owner of the group, is said to have visited Shenyang, China, in January and May 2019. There, Kim met with officials of the North Korean Asia-Pacific Peace Committee and the North Korean National Economic Cooperation Federation.
Lee Hwa-young, Gyeonggi vice governor for peace and a former lawmaker, reportedly accompanied Kim. He is known to be a confidante of Lee Jae-myung who was then Gyeonggi Province governor and is now the leader of the main opposition Democratic Party of Korea.
Meanwhile, Nanos, a Ssangbangwool affiliate now renamed SBW Life Sciences, reportedly signed an agreement on a business project with the North Korean National Economic Cooperation Federation at the time. Nanos is said to have been promised rights to mine rare-earth elements and other minerals in North Korea. Nanos' stocks soared on the news.
The agreement is linked to the group's indirect sponsorship of an event which involved North Korea. Ssangbangwool donated hundreds of million won to the Seoul-based Asia Pacific Exchange Association, which co-hosted the event with Gyeonggi Province. The association spent the group's donation on holding the "International Convention for Peace & Prosperity in the Asia Pacific" jointly with the province in November 2018 and July 2019.
High-ranking North Korean bureaucrats, including Ri Jong-hyok, vice chairman of the North Korean Asia-Pacific Peace Committee, attended the event.
In late January 2019, after the first edition of the convention, Nanos recruited the chairman of the Asia Pacific Exchange Association as a member of its board.
These circumstances indicate a fair chance of Ssangbangwool smuggling out foreign currencies to pay for the mineral business right and the attendance of North Korean officials at the event.
As a close aide to then-Gov. Lee Jae-myung, Vice Gov. Lee Hwa-young took charge of the inter-Korean exchange event. The province publicized it as Gov. Lee's achievement.
Lee Hwa-young was recruited as vice governor for peace after Lee Jae-myung took office as Gyeonggi governor. Before being appointed to the post, Lee Hwa-young worked for Ssangbangwool as an outside director.
As vice governor, he received a corporate credit card from Ssangbangwool and spent hundreds of million won with the card. He was recently detained on charges of accepting bribes.
Ssangbangwool is also suspected of paying about 2 billion won in attorney fees for Lee Jae-myung’s trial regarding his election law violations.
It’s probable that the former Ssangbangwool Chairman Kim knew the final destination of the smuggled money. But he fled abroad in May after the prosecution stepped up its probe into allegations involving the group.
A thorough investigation is required to find out if the group's money flowed into North Korea -- a grave issue related to UN sanctions on the communist state -- and also clarify suspicious connections between the Democratic Party leader, his close aide, Ssangbangwool and North Korea.
