2nd LD) Ex-president's brother arrested in bribery probe

(ATTN: RECASTS headline, UPDATES lead, paras 3-6, 13-16 with details)
SEOUL, Dec. 4 (Yonhap) -- The prosecution detained the elder brother of former
President Roh Moo-hyun on Thursday after a court granted a warrant for his arrest
over allegations he took bribes for a business favor in 2006.
Roh Gun-pyeong, 66, is suspected of influencing the state-run National
Agricultural Cooperative Federation, or Nonghyup, to take over an ailing
securities firm and accepting as much as 3 billion won (US$2 million) in bribes
while his brother was in office.
The Seoul Central District Court said the allegations are "grave" and Roh "may
destroy the evidence or flee," accepting prosecutors' request for his arrest.
After an intensive 12-hour interrogation, Choi Jai-kyeong, spokesman for the
Supreme Prosecutors' Office, said judging by "common sense," suspicions about
Roh's crime hold ground.
Roh has denied the bribery allegations.
"In the courtroom, I explained in detail that I am not guilty," he told reporters
earlier in the day after being questioned by a judge.
The probe was reminiscent of similar corruption scandals that have surfaced in
successive administration to penalize relatives and friends of previous leaders
for influence-peddling. Roh's detention was a sharp blow to former President Roh
Moo-hyun, who promoted "clean politics" in office and still remains politically
active, aiming acerbic criticism against the conservative Lee Myung-bak
administration.
Investigators allege Roh Gun-pyeong conspired with lobbyists for the takeover and
shared 3 billion won in lobbying funds with them.
Strapped for cash, Sejong Securities wanted to be taken over by Nonghyup, a giant
conglomerate that has a number of agricultural and financial affiliates under its
wing, in 2005.
The security firm's parent company, Sejong Capital, handed over 3 billion won to
lobbyists who used their networks with Roh. The lobbyists used 1.8 billion won to
buy business space and video game equipment in a building near Roh's rural home,
Bonghwa village in South Gyeongsang Province, according to investigators.
Prosecutors suspect that the video game arcade and its proceeds worth 300 million
won might have been intended as compensation for Roh.
The allegations, if proven, could land him a jail sentence of up to five years or
a fine of 50 million won.
Roh has said he had only made a simple phone call to the chief of Nonghyup and
his long-time acquaintance, Chung Dae-kun, to introduce the securities firm and
that no influence-peddling took place.
Nonghyup bought Sejong Securities for 110 billion won in July 2006, about half a
year after Roh called its chief. Chung is currently serving a jail term from
another bribery case.
The probe also seeks to bring to court a key sponsor for the former president.
Park Yen-cha, head of Taekwang Industry Co., a leading shoemaker and a Nike
outsourcing firm, is suspected of reaping huge earnings from the Sejong
Securities takeover and acquiring a Nonghyup affiliate at a bargain.
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.
Park and Roh will be represented by first-rate lawyers in court, sources said.
In 2004, Roh Gun-pyeong received a suspended jail term for accepting 30 million
won from the head of Daewoo Engineering and Construction.
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 in Bonghwa village. The former
president retired there in February.
hkim@yna.co.kr
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