Prosecution focuses on probing companies in Choi scandal

The prosecution appears to be focusing on whether local firms were coerced into funding nonprofit foundations in return for favors, accelerating a probe into the scandal involving President Park Geun-hye and her confidante Choi Soon-sil. 

Out of the 53 local companies that gave a combined 77.4 billion won ($66.5 million) in donations to the Mir Foundation and K-Sports Foundation, Kwon Oh-joon, CEO of the nation’s No. 1 steelmaker Posco, was the first to undergo questioning.

Kwon was set to be grilled over allegations that Choi’s close associate Cha Eun-ta had threatened an ad company, which was selected as a preferential bidder for Posco’s former affiliate Poreka, to hand over 80 percent of its shares after Cha failed to take over Poreka.

An Chong-bum, an ex-presidential secretary for policy coordination, also played a role in allegedly extorting shares from the company.

A local media outlet broke the news Friday that Kwon and An allegedly made several phone calls and exchanged text messages at around the time Cha and An together attempted to take over the ad company.

The prosecution earlier said that it might possibly investigate seven heads of the nation’s biggest firms, as it was revealed that President Park had close-doors meetings with them to ask for financial donations for the foundations. 

The prosecution also questioned officials from companies including Daerim Corp. which allegedly contributed 600 million won to the foundations. A director from Daerim had served as a member of the board of directors at the Mir Foundation.

The ongoing probe is expected to offer clues on President Park’s role in the donations. Park’s aides involved in the scandal reportedly testified that they had pressured local firms to raise funds under Park’s direct orders.

Choi, a 60-year-old civilian accused of meddling in state affairs, is allegedly at the center of establishing and running the foundations. The ex-presidential aide An and the music video director Cha also helped manage them.

Woo Byung-woo, a former presidential secretary for civil affairs, is facing prosecutorial questioning for separate charges of embezzlement and abuse of power. But emerging evidence suggests that he had oversaw the alleged wrongdoings committed by President Park’s aides.

According to a local media outlet, the presidential office Cheong Wa Dae had contacted Cha when he was in China to possibly dodge questioning as the probe into the Choi scandal escalated. The left-wing news outlet suspected them of discussing details in preparation for the prosecutorial questioning.

Fresh allegations also emerged against Cha late Thursday.

Media reports said that Cha had abused his power to demand entertainment giant CJ group give him the top posts for two projects led by the conglomerate.

Cha allegedly sought to head the Creative Center for Convergence Culture, a major cultural project under the Park administration. He also wanted to have authority to arrange all the performances at the entertainment complex K-Culture Valley to be built in Goyang, Gyeonggi Province.

As CJ Group refused the requests, according to local media, Cha did not grant favors to the firm.

Cha also allegedly peddled influence to get his close associates jobs at telephone company KT Corp. He also used his ties to have his company selected as an ad agency for KT.

Cha is involved in other allegations that he meddled in personnel appointments in the Culture Ministry, monopolized lucrative state-led projects for his personal gain and pocketed money from his own company.

The prosecution applied for a court-issued warrant to arrest Cha, who holds no government post, on charges of abuse of authority as an accomplice to An in coercion, embezzlement and bribery.

By Ock Hyun-ju (laeticia.ock@heraldcorp.com)