By Lee Kyung-min
Police booked a senior official at the Military Mutual Aid Association (MMAA), Monday, over suspicions he caused a deficit of nearly 93 billion won ($83 million) in the organization by fabricating its accounting books.
According to police, the official, a former construction businessman whose identity is being withheld, is suspected of putting an apartment complex up for public auction after devaluing it to help his acquaintance, a medium-sized construction firm, win a bid there. MMAA, one of the creditors of the complex, claimed it after its earlier creditor Ssangyong E&C went under court receivership.
The MMAA said the original price for the site stood at 140.4 billion won but it dropped to 47.5 billion after nine biddings, incurring a loss of 92.9 billion.
The official, police said, underreported the projected income and inflated expenditures, intending to leave the association board no choice but to vote in favor of it being put up for public auction. The board approved the motion after agreeing it was the only way to recover the initial 85 billion won investment.
Police will soon question another official at Daehan Real Estate Trust, an MMAA subsidiary, over suspicions he blocked attempts of other firms that sought to participate in the bidding.
The MMAA is a 170,000-member welfare-orientated credit union here for military service personnel. It is often criticized for its murky governing structure as its top decision-making body is mostly comprised of former military and defense ministry officials.