By Kim Rahn
Officials at the High1 Sangdong Themepark, a subsidiary of Kangwon Land, are under investigation for bribery.
Prosecutors suspect that a construction company gave money to officials of the planned resort, which is an affiliate of Kangwon Land ― the nation’s only casino for Koreans.
The subsidiary was set up to build a theme park in Yeongwol, Gangwon Province, which is located near the casino, in an effort to revive the economy of the former mining region. Kangwon Land invested more than 47 billion won into the theme park.
Construction of the park began in November 2011 and was scheduled for completion in May this year.
However, the project was suspended in April after the Board of Audit and Inspection (BAI) and Kangwon Land’s own inspection team questioned its economic feasibility.
The BAI also pointed out an improper contract process. The original builder had suffered from financial difficulties and could not continue the construction process; it then subcontracted the work out to a smaller, unqualified company.
Such subcontracting was against the terms of the contract, but High1 Sangdong Themepark did not take any action to address this, according to the BAI.
The prosecution suspects High1 officials received bribes from the subcontractor, but any such deal would have been impossible without endorsement from Kangwon Land.
According to the builder’s accounting books, it spent a total of 10 million won between May 11 and 27 in 2012, which was listed as “gratitude to High1.”
The builder sent further payments amounting to tens of millions of won to High1, classified in its accounts as “for Chuseok” and “golf expenses.”
According to a report by local news broadcaster YTN, the head of the building firm said in an email that he had offered money to Choi Jong-ho, chief of High1 Sangdong Themepark.
The accused officials, including Choi, all deny the allegations.
Prosecutors say they have secured testimony from the building subcontractor saying money was provided to High1 officials. Investigators will see if they offered business favors in return. “We plan to summon the officials soon,” a prosecutor said.
The theme park was initially designed to include gardens, a condominium and a hedge maze with a theme of healing. High1 later attempted to add a “glamping” (glamorous camping) zone and a dormitory for employees, which meant the original construction cost of 35 billion won soared to 47.6 billion won.
After initial plans were scrapped due to the poor economic feasibility, construction also came to a halt. The company is now studying how to use some of the already-built facilities.
“It can be used for either a healing-themed garden or a training center. We are in the process of selecting a subcontractor for the operation,” an official from High1 said.