Former Pres. Roh's brother denies taking bribes in securities firm sale

(ATTN: UPDATES headline, throughout with prosecutor quote)
SEOUL, Dec. 1 (Yonhap) -- A brother of former President Roh Moo-hyun denied
allegations that he had accepted bribes for the 2006 sale of an ailing securities
firm as prosecutors questioned him in an influence-peddling probe on Monday.
Roh Gun-pyeong, 66, is suspected of influencing the state-run conglomerate
Nonghyup, or the National Agricultural Cooperative Federation, to take over
Sejong Securities Co. as it teetered on the brink of default in January 2006.
Several Roh associates have been questioned over the corruption scandal. Such
probes into former presidents' relatives and friends have become common in South
Korea.
Roh was cooperative in the questioning, but flatly denied the allegations, said
Choi Jai-kyeong, a spokesman for the Supreme Prosecutors' Office.
"I have never taken economic benefits" from the takeover, Roh was quoted as
saying by Choi.
Prosecutors allege he played a role in the acquisition and was promised real
estate in return.
The parent company of Sejong Securities reportedly wanted the firm to be taken
over by Nonghyup rather than a private, smaller company, and used its networks
with Roh.
The parent company, Sejong Capital, gave 3 billion won to lobbyists who were
acquainted with Roh, and they bought a video game arcade worth 800 million
(US$542,373). Prosecutors allege that the arcade might have been intended as
compensation for Roh.
The allegations, if proven, can land him in a jail term up to five years or a 50
million won fine.
Roh has said he had only made a simple phone call to the chief of Nonghyup at
that time, Chung Dae-kun, to introduce the securities firm and that no
influence-peddling took place.
Prosecutors were investigating whether Roh meant to coax Nonghyup into the 110
billion (US$75 million) takeover, whether he was the actual owner of the arcade,
and whether he received any form of payment after the takeover.
Nonghyup selected Sejong Securities as its preferred merger partner shortly after
Roh had called the Nonghyup chief in mid-2005, prosecutors said. Half a year
later, Nonghyup signed the acquisition deal with Sejong Securities, which was
then renamed Nonghyup CA Asset Management.
The Nonghyup chief, a long-time friend of Roh, was also suspected of pocketing
bribes in the takeover. He is serving a jail term on another bribery case.
Prosecutors planned to seek an arrest warrant for Roh. They will decide later in
the day whether to hold him or send him home before a court decides on the
warrant.
Former President Roh Moo-hyun has been reserved in commenting on the case.
Pressed by reporters while greeting visitors at his rural residence on Sunday
afternoon, he said, "Let's wait for the prosecutors' investigation."
A key sponsor for the former president also faces trial. Park Yen-cha, head of
Taekwang Industry Co., a leading shoemaker and a Nike outsourcing firm, was
accused of reaping huge earnings from the Sejong Securities takeover and
acquiring a Nonghyup affiliate at a bargain price.
Park had invested 11 billion won in the shaky securities firm just months before
the takeover and earned 17.8 billion won when its shares jumped when news of the
deal broke.
In 2004, Roh Gun-pyeong was convicted of accepting 30 million won in bribes from
the head of Daewoo Engineering and Construction and received a suspended jail
term.
The Daewoo E&C chief, Nam Sang-kook, committed suicide by jumping into the Han
River after then President Roh publicly shamed him during a public conference
broadcast nationwide.
The Rohs now live in their rural hometown, Bonghwa village in South Gyeongsang
Province. The former president retired there in February.
The corruption scandal cast a shadow on the legacy of the former president, who
had promoted "clean politics" and sought to distance himself from his
predecessors, who had been plagued by corruption.
hkim@yna.co.kr
(END)