Lotte Group chief grilled over bribery

Lotte Group Chairman Shin Dong-bin lowers his head as he enters the Seoul Central District Prosecutors' Office in southern Seoul, Friday. / Korea Times photo by Shim Hyun-chul

By Jung Min-ho

Lotte Group Chairman Shin Dong-bin was questioned Friday in connection with the massive corruption scandal that caused the removal of former President Park Geun-hye from office.

Shin appeared at the Seoul Central District Prosecutors’ office at 9:15 a.m. As he wedged his way there through journalists, he said, “I will fully cooperate with the investigation.”

The retail giant is accused of offering bribes to the Mir and K-Sports foundations controlled by Park’s close friend Choi Soon-sil in return for favors from the government in recovering its duty-free operating license last year.

This is part of the prosecutors’ bribery investigation into Park and Choi, who allegedly colluded in collecting money from major companies in exchange for business favors.

Lotte gave 4.5 billion won ($4 million) to the foundations in January 2016. But investigators have also found out about another suspicious donation the company offered.

After Shin had a private meeting with Park on March 14, 2016, the government announced that it would issue more licenses the next month to operate duty-free shops in Seoul. Within a month, Lotte announced that it would give an additional 7 billion won to the K-Sports foundation and all the money was sent there by May 31.

But the foundation gave the money back to Lotte early in June ― only days before prosecutors raided Lotte affiliates over slush funds and illegal lobbying of government officials.

It is unclear why the foundation returned the money, which is one of the things prosecutors are focusing on to find out. Eventually, Lotte recovered its license after the decision of the Korea Customs Service.

The prosecution previously said Lotte was forced by the government to make donations, but the investigation took a new turn after the independent counsel team concluded that not all of the executives were victims of Park’s abuse of power. The team said some made “backdoor deals” with the government in their own interests.

On the same day, the trial began for Samsung Electronics Vice Chairman Lee Jae-yong, who has been indicted on charges of giving or promising 43.3 billion won to Choi in bribes.

According to the independent counsel team, Samsung offered the money to take advantage of Choi’s friendship with Park, who later allegedly pressured the National Pension Service to vote for a merger of two Samsung units in 2015 ― a crucial decision for Lee in order to tighten his control of the group’s management.

But Lee’s lawyer denied the allegations, claiming Samsung’s contribution to the foundations had no strings attached.

“It was an assistance made following then President Park’s request to promote cultural prosperity and sports development, which did not involve getting any favors in return,” the lawyer said.

The lawyer also said the merger was just part of the company’s many management activities, insisting that it wasn’t for “transferring power.”