The Democratic Party of Korea, which holds majority control of the National Assembly, is set to pass a bill Thursday to appoint a special counsel to investigate first lady Kim Keon Hee over her alleged involvement in stock price manipulation that took place between 2010 and 2012.
Under the previous Moon Jae-in administration, the Seoul Central District Prosecutors’ Office investigated the allegations against Kim for a year and half, but failed to indict her.
The court ruled on the Deutsch Motors stock price manipulation case in February this year. It sentenced Kwon Oh-soo, former chairman of the BMW car dealership in Korea, to two years in jail, suspended for three years, and ordered him to pay a fine of 300 million won ($232,000) for violating the Capital Markets Act. According to the court, Kwon sought to manipulate the company’s stock price by conspiring with influential market players, himself profiting about 89 million won while some of his accomplices suffered financial losses amounting to tens of millions of won. Five others who took part in the stock price manipulation were also sentenced to suspended prison terms and fines.
The first lady was among the 91 people whose accounts were implicated in the scheme. A person surnamed Sohn, whose account was used for illegal stock trading that amounted to transactions larger than Kim’s, was indicted but found not guilty.
The opposition Democratic Party has demanded a probe by a special counsel to further scrutinize the first lady’s involvement. President Yoon Suk Yeol’s office has claimed that Kim was not complicit.
Although Kim’s implication in the Deutsch Motors stock price manipulation took place before she married Yoon in March 2012, and some 10 years prior to Yoon’s election as president, lawmakers can push for a special counsel probe if they believe the first lady’s past is something South Koreans must immediately get to the bottom of -- and if it is worth the billions of won in taxpayer money it could cost.
But the timing of the envisioned probe, which is clearly politically motivated, matters.
If Yoon does not exercise his right to request the Assembly to reconsider the bill, the special counsel investigation will begin in mid-February and conclude after the general election for lawmakers on April 10.
Press briefings about the probe will no doubt dictate the news agenda in the lead up to the ballot. Whatever the special prosecutor, who will be recommended by the opposition, says will overshadow the campaigns of individual candidates.
The general election is about choosing the most capable candidate to represent each constituency and building a competent and trustworthy legislature. How much the first lady knew when she was implicated in the stock manipulation scheme over 10 years ago is irrelevant in picking who will best serve the interests of a region.
If the special prosecutor adds weight to the possibility of Kim having committed a crime, is it fair that candidates of the ruling party are punished for it at the polls?
Putting off an investigation in order to keep it from unduly affecting a major election is not unprecedented. In 1997, just two months ahead of the presidential election, the camp of the then-conservative party’s Lee Hoi-chang alleged that his liberal opponent Kim Dae-jung had amassed slush funds, and filed a complaint with the prosecution to investigate the case. Then-President Kim Young-sam told his chief prosecutor to defer the probe.
A significant share of voters already have doubts about the first lady’s integrity. This risk is something the ruling party will have to face in the upcoming ballot.
While Yoon may have good reasons to veto, or ask the parliament to reconsider the bill, he should also explain why, should he choose to do so. How sincere and convincing his words are will make a difference in the general election, the results of which will significantly affect the remaining three years of his term.
