Special counsel to indict 7 or 8 people in 'retirement home scandal'

Up to eight people, including President Lee Myung-bak's only son, are expected to be indicted in connection with a controversial land deal for Lee's now-scrapped retirement home project, according to sources at a special counsel probing the case on Tuesday.

Special prosecutor Lee Kwang-bum's team is reviewing final legal principles before it announces the outcome of its probe on Wednesday after President Lee turned down a request for extending the investigation, they said.

The team was given 30 days to investigate allegations that the president's only son, Lee Si-hyung, and the Presidential Security Service (PSS) used public funds and violated real estate laws when they jointly bought a plot of land last year for the retirement residence, which was to be built in Naegok-dong on the southern edge of Seoul.

The cost was allegedly not shared evenly, with the PSS paying too high a price for the site for security facilities, at the expense of taxpayers.

In addition to Lee Si-hyung, a number of former and incumbent presidential officials are also on the indictment list, sources said, adding that they will be prosecuted without detention on separate charges.

The 34-year-old younger Lee is facing charges of breaking real estate laws by using the wrong name in a real estate transaction, they said. The country's real estate laws ban transactions under borrowed names.

During the previous prosecutors' questioning through a written statement in May of this year, the younger Lee said the land was purchased under his name and he intended to change it to the president's name later. He, however, retracted an earlier statement during special prosectors' questioning, saying that he was actually planning to keep the land.

The team is also not ruling out an option of brining charges of evading a capital transfer tax against him, sources said.

Other former and incumbent presidential officials are facing dereliction of duty charges by letting Lee Si-hyung buy the site at a below-market price and gain a profit of between 600 million ($542,000) and one billion won.

Meanwhile, the team will review a list of questions later in the day as first lady Kim Yoon-ok is expected to turn in a written statement over her alleged role.

Since the allegations were raised by the opposition parties, the presidential office has flatly rejected suspicions it was an illicit scheme to help the president's son profit. Prosecutors who initially probed the case also cleared everyone involved in the deal.

Facing mounting public criticism, however, Lee later scrapped the project and decided to move into his existing private house in southern Seoul after leaving office in February next year. (Yonhap)