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Pension fund chief held as South Korea scandal widens
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SOUTH Korean prosecutors put the chairman of the world’s third-largest pension fund under emergency arrest yesterday in a widening influence-peddling scandal that has led to parliament voting to impeach President Park Geun-hye.
The special prosecutor’s office did not provide further details on the arrest of National Pension Service Chairman Moon Hyung-pyo. Officers on Monday raided his home on suspicion of abuse of power.
The special prosecutor has been looking into whether Moon pressured the pension fund to support the US$8 billion merger last year of two Samsung Group affiliates while he was head of the Ministry of Health and Welfare, which runs the NPS.
Investigators are also examining whether Samsung’s support for a business and foundations backed by the president’s friend, Choi Soon-sil, who is at the center of the influence-peddling scandal, may have been connected to NPS support for the merger, a prosecution official said last week.
Moon said on Tuesday, as he arrived at the prosecutor’s office, he would cooperate and did not comment when asked if he pressured the NPS to vote for the merger.
On December 9, the NPS dismissed as “groundless” a media report that Moon had coerced the pension agency to support the merger.
The NPS had US$450 billion under management at the end of September and was a major shareholder in Samsung Group affiliates Cheil Industries Inc and Samsung C&T Corp when they merged last year.
Some investors criticized the tie-up for strengthening the founding family’s control of Samsung Group, South Korea’s largest “chaebol,” or conglomerate, at the expense of other shareholders.
TV footage showed Moon arriving in a detention center van at the office of the special prosecutor, escorted by guards and wearing a prison uniform.
Park, 64, whose father ruled the country for 18 years after seizing power in a 1961 coup, is accused of colluding with her long-time friend, Choi, who has been indicted and is in custody, to pressure big businesses to make contributions to non-profit foundations backing presidential initiatives.
Park has denied wrongdoing but she has apologized for carelessness in her ties with Choi, a friend for four decades, who has also denied wrongdoing. Choi is in detention pending trial.
Parliament voted to impeach Park over the scandal on December 9, a decision that must be upheld or overturned by the Constitutional Court within 180 days.
In the meantime, she has been stripped of her powers, which have been assumed by the prime minister, although she remains in the presidential Blue House.
Big street protests have been held every Saturday for the last nine weeks to demand that she step down immediately.
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