Five-month probe finds no critical flaw with steelmaker
By Park Si-soo
The prosecution is under increasing pressure to stop its POSCO slush fund investigation because it has found no critical fault with the nation's biggest steelmaker despite a no-holds-barred probe conducted over five months.
Worse, the court has rejected several requests for arrest warrants for whom prosecutors called prime suspects for lack of evidence. This sparked speculation that the prosecution acted too quickly when it launched the probe in March, resulting in many critical errors.
Analysts say the ill-prepared investigation has dealt a severe blow to POSCO's business activities and undermined its international reputation and competitiveness, especially in the face of an industry-wide slump and fiercer competition at home and abroad.
"I don't oppose the investigation itself, but it should be done in a way that doesn't hamper POSCO's business activities," said an industry insider familiar with the issue, Sunday. "And if it fails to find anything wrong with it (POSCO), they (prosecutors) should stop the investigation.
"What do prosecutors carry out an investigation for? The fundamental goal may be to boost the company's competitiveness by eliminating unlawful practices, not hampering its business."
The investigation is fizzling out because it started with a political motivation, according to officials.
The investigation started one day after then Prime Minister Lee Wan-koo declared a war on corruption. Lee was forced to resign shortly afterward for being involved in a bribery scandal.
Investigators initially targeted POSCO's construction arm, believing it played an important role in creating slush fund, part of which was believed to have funneled into the pockets of politicians critical of President Park Geun-hye, and Chung Joon-yang, former POSCO chairman and close aide to former President Lee Myung-bak, Park's predecessor and political rival.
But investigators found nothing backing the scenario so they expanded the probe into other POSCO affiliates and their business partners, but to no avail.
The latest blow to the prosecution took place Saturday when a court rejected the prosecution's request for a warrant to arrest Bae Sung-ro, former chairman of Dongyang, a mid-sized construction firm, due to a lack of evidence.
Bae was suspected of having distributed bribes to POSCO Engineering and Construction (E&C) executives in exchange for business favors.
"Judging from submitted evidence, I don't think Bae should be detained," said Seoul Central District Court Judge Kim Do-hyung, who handled the case.
The prosecution plans to seek an arrest warrant for Bae again.
The court twice turned down the arrest warrant request for former POSCO E&C Vice Chairman Chung Dong-hwa for the same reason.
Chung was thought to have played a pivotal role in creating a 10 billion won slush fund, but the prosecution failed to find critical evidence.
By Park Si-soo
The prosecution is under increasing pressure to stop its POSCO slush fund investigation because it has found no critical fault with the nation's biggest steelmaker despite a no-holds-barred probe conducted over five months.
Worse, the court has rejected several requests for arrest warrants for whom prosecutors called prime suspects for lack of evidence. This sparked speculation that the prosecution acted too quickly when it launched the probe in March, resulting in many critical errors.
Analysts say the ill-prepared investigation has dealt a severe blow to POSCO's business activities and undermined its international reputation and competitiveness, especially in the face of an industry-wide slump and fiercer competition at home and abroad.
"I don't oppose the investigation itself, but it should be done in a way that doesn't hamper POSCO's business activities," said an industry insider familiar with the issue, Sunday. "And if it fails to find anything wrong with it (POSCO), they (prosecutors) should stop the investigation.
"What do prosecutors carry out an investigation for? The fundamental goal may be to boost the company's competitiveness by eliminating unlawful practices, not hampering its business."
The investigation is fizzling out because it started with a political motivation, according to officials.
The investigation started one day after then Prime Minister Lee Wan-koo declared a war on corruption. Lee was forced to resign shortly afterward for being involved in a bribery scandal.
Investigators initially targeted POSCO's construction arm, believing it played an important role in creating slush fund, part of which was believed to have funneled into the pockets of politicians critical of President Park Geun-hye, and Chung Joon-yang, former POSCO chairman and close aide to former President Lee Myung-bak, Park's predecessor and political rival.
But investigators found nothing backing the scenario so they expanded the probe into other POSCO affiliates and their business partners, but to no avail.
The latest blow to the prosecution took place Saturday when a court rejected the prosecution's request for a warrant to arrest Bae Sung-ro, former chairman of Dongyang, a mid-sized construction firm, due to a lack of evidence.
Bae was suspected of having distributed bribes to POSCO Engineering and Construction (E&C) executives in exchange for business favors.
"Judging from submitted evidence, I don't think Bae should be detained," said Seoul Central District Court Judge Kim Do-hyung, who handled the case.
The prosecution plans to seek an arrest warrant for Bae again.
The court twice turned down the arrest warrant request for former POSCO E&C Vice Chairman Chung Dong-hwa for the same reason.
Chung was thought to have played a pivotal role in creating a 10 billion won slush fund, but the prosecution failed to find critical evidence.
