[비즈한국] Last week, an arrest warrant for Son Tae-seung, former chairman of Woori Financial Group316140, was rejected in connection with the alleged illicit loan scandal at Woori Bank. The prosecution's plan to secure Son's detention and subsequently verify the alleged involvement of current management now faces inevitable setbacks.
With the rejection of Son Tae-seung's warrant, legal experts are criticizing the prosecution, suggesting its corporate investigations have lost their edge. Arrest warrants requested twice for Ku Young-bae, CEO of Qoo10 Group, regarding the TMON-WeMakePrice (TMEM) settlement crisis were both rejected. Similarly, regarding the Taekwang Group investigation, requests were rejected multiple times, including once for former Taekwang Group Chairman Lee Ho-jin and twice for former Taekwang Group Management Council Chairman Kim Ki-yu.
Is the Court Criticizing the Prosecution Through Warrant Rejections?
The Seoul Southern District Prosecutors' Office Financial Investigation Division 1 (Chief Prosecutor Kim Soo-hong) requested an arrest warrant for former Chairman Son on the 22nd. The prosecution’s assessment was that Woori Bank had provided 46 billion KRW in illicit loans to relatives of Son between April 2020 and January of this year.
However, from the very stage of the warrant request, concerns were raised in the legal community that "it is difficult to conclude that these were illicit loans simply because they were not recovered." Indeed, on the 26th, Jung Won, the judge in charge of warrants at the Seoul Southern District Court, rejected the request, stating, "Given the prosecution’s level of proof regarding conspiracy or specific acts of participation, there is room for the suspect to contest these charges, thus necessitating the guarantee of his right to a defense."
Previously, the prosecution had expanded its investigation to the current management by raiding the Woori Bank headquarters. In particular, the prosecution and the Financial Supervisory Service had maintained that current management, including Woori Financial Group Chairman Yim Jong-yong and Woori Bank President Cho Byung-kyu, should also be held accountable for allegedly delaying the report to financial authorities despite being aware of the illicit loan suspicions. However, the aggressive warrant request led to a rejection, making delays inevitable.
There is a prevailing view that the grounds for rejection cited by the court serve as a criticism of the "shoddy investigation" by the prosecution. A legal expert familiar with the case revealed, "From the initial stage of the investigation, no evidence was captured suggesting that former Chairman Son explicitly directed the loans to be granted. Most of the prosecution's judgments remain at the level of 'conjecture.' It was openly rumored that the warrant request was excessive." The explanation is that the prosecution was only able to secure the arrest of three individuals, including Son’s brother-in-law, because they confirmed the possibility of excessive lending, not because they verified Son's specific involvement.
Both Ku Young-bae and Kim Ki-yu Rejected Twice
The Seoul Central District Prosecutors' Office TMEM dedicated investigation team (led by Chief Prosecutor Lee Joon-dong) also requested warrants twice to secure the detention of Qoo10 CEO Ku Young-bae, emphasizing the nature of a "Ponzi scheme," but both were rejected. On the 19th of last month, Nam Cheon-kyu, the judge in charge of warrants at the Seoul Central District Court, decided to reject the warrants again during the suspect interrogation (warrant review) for CEO Ku and CEOs Ryu Kwang-jin and Ryu Hwa-hyun.
The prosecution later expressed frustration, stating, "It is regrettable that the court appears to be turning a blind eye when there are numerous victims." However, the legal community points out that "they aggressively requested warrants twice based solely on the argument that the amount of damages is significant."
An attorney with experience as a warrant judge noted, "Although the presiding judge changes when a warrant is re-filed, they share their reasoning. Unless new charges or evidence beyond what was previously presented are found, the results rarely change. Having already had a warrant rejected under the 'Ponzi scheme' frame, filing for another one is essentially betting on low odds."
Additionally, the Seoul Western District Prosecutors' Office Criminal Division 4 (Chief Prosecutor Yeo Kyung-jin) saw two arrest warrant requests for former Taekwang Group Management Council Chairman Kim Ki-yu rejected regarding alleged illicit loans to affiliates, and an arrest warrant for former Taekwang Group Chairman Lee Ho-jin, requested by the police, was also rejected once. This is why it is being said that the prosecution's edge in corporate investigations has "dulled."
A former chief prosecutor turned lawyer remarked, "Looking at the warrant requests, there are many sentences written in 'presumptive' language, such as 'it appears that,' rather than the prosecution having secured clear evidence. In legal defense, there are times when defendants don't tell the whole story, so if evidence emerges, even defense attorneys have no choice but to admit it. Looking at recent investigations, it seems the prosecution is too fixated on securing the arrest of 'higher-ups' at any cost, which has led to the result of having warrants for key suspects rejected."