Ex-president Chun’s hidden assets recovered from U.S.

Family members of former Korean President Chun Doo-hwan agreed to forfeit assets of more than $1 million laundered in the U.S., as a result of a joint probe by the two countries to seize the funds, U.S. authorities said Thursday.

The U.S. Department of Justice said that it had reached a settlement in the forfeiture case involving assets worth $1.2 million belonging to Chun’s family, including a house at Newport Beach, California, and an investment made in a Philadelphia limited partnership.

The U.S. has supported the Korean authorities’ efforts to recover Chun’s illegal assets since July 2013 as part of Washington’s new measures to recover the proceeds of foreign official corruption, U.S. authorities said. Earlier last year, the ally assisted Seoul in collecting $28.7 million that Chun had concealed in the States.

“The U.S. will not idly stand by and serve as a money-laundering haven for foreign officials to hide corrupt activities,” FBI Assistant Director in Charge David Bowdich said.

Chun, a former army general who led the 1979 coup and controlled the country until 1988, was sentenced to life in prison for corruption, mutiny and treason in 1995. After being pardoned in 1997, the disgraced former president was ordered to pay 220.5 billion won ($200.4 million) in penalties but paid only one-fourth of the total.

Five months before the statute of limitations on collecting Chun’s fines was to expire in October 2013, the Korean prosecution launched an investigation into Chun and his family to seize the unpaid fines of 167 billion won. Prosecutors detained a younger brother of the disgraced ex-president’s wife over tax evasion and grilled Chun’s second son, who was suspected of using his father’s slush fund.

The National Assembly also supported the investigators’ move by revising a law to better collect fines through uncovering hidden assets of public officials.

Chun’s family made a public apology in September 2013 and vowed to pay the rest of the fines through selling real estate, paintings and other assets.

As of this month, Chun still has about 119 billion won to pay, the Korean authorities said. Investigators said they would continue to seek Chun’s concealed property.

U.S. judiciary officials will turn over the forfeited money to Korea soon, officials said.

By Lee Hyun-jeong (rene@heraldcorp.com)