Absence of FKI vice chairman fuels scandal

By Lee Hyo-sik

Lee Seung-cheol FKI Vice Chairman

Federation of Korean Industries (FKI) Vice Chairman Lee Seung-cheol left for the United States, Tuesday, amid an escalating scandal over allegations that FKI gave money to a right-wing civic group in return for organizing pro-government and pro-business rallies.

The lobby representing the interests of Korea’s family-controlled conglomerates says Lee’s trip to attend a Korea-U.S. business meeting in California on April 28 and 29 was arranged previously, adding he will return when his schedule ends.

However, critics argue that Lee, who is at the center of the growing controversy, may have left the country because the prosecution has begun investigating ties between the FKI and conservative civic group the Korea Parent Federation (KPF).

“Vice Chairman Lee left for the United States to attend the 28th Korea-U.S. Business Council meeting in Santa Clara, California,” an FKI official said. “His trip was scheduled months ago. I don’t know exactly when the vice chairman will return. But as soon as Lee winds up his schedule, he will come home. It is nonsense to insist that he went to the United States to evade the prosecution’s probe.”

But the liberal Citizens’ Coalition for Economic Justice (CCEJ), which filed the complaint on April 21 with the Seoul Central District Prosecutors’ Office to investigate the allegations, said Lee’s absence could cause a setback to the investigation.

On Tuesday, the prosecution said investigators will look into the case to check whether the FKI and KPF broke the law.

“We are concerned that the FKI vice chairman may decide not to return home anytime soon,” CCEJ coordinator Chung You-rim said. “We really hope that Lee comes back soon to face the prosecution’s probe.”

Lee, who became FKI vice chairman in 2013, has been running the organization because FKI Chairman Huh Chang-soo, who is also GS Group chairman, has largely remained on the sidelines. With more than 400 member companies, the FKI has annual revenue of more than 30 billion won ($26 million).

Since April 19, when a local TV channel reported that the lobby group transferred 120 million won to the KPF between September and December 2014, the vice chairman and other FKI officials have remained silent about its ties with the KPF.

The channel alleged that the money was offered in return for organizing pro-government and pro-business rallies by hiring North Korean defectors to participate.

A local weekly magazine also reported that the parents’ group hired 1,259 North Korean defectors as participants in 39 rallies against the commemoration of the Sewol ferry victims between April and November 2014. According to the parent group’s account book, 25.18 million won was used to pay 20,000 won to each participant.