SEOUL - The United States faces a Faustian
decision that may influence the outcome of Korea's
presidential election in December and shape the
immediate future of US-Korean relations.
Much though US leaders would like to avoid
the whole nasty topic, they've got to decide soon
when or whether to extradite to Korea a runaway
financier whose sorry story of a scandal is linked
to the conservative presidential candidate Lee
Myung-bak. Lee's people, however, say he's got
nothing to do with the whole
thing and they're not worried
about it.
The principle figure in the case
is Kim Kyung-jun, a Korean-American who partnered
with Lee in a financial firm named BBK in Seoul
before fleeing to Los Angeles five years ago
leaving a trail of aggrieved investors in his
wake.
While Lee remains far and away the
front runner in all the polls, members of the
United New Democratic Party (UNDP) sense a chance
to pull ahead in the final weeks if only Kim could
be forced to return to South Korea and face
investigators in civil and possibly criminal
cases. That inquiry, they say, will inevitably
draw Lee, whose financial dealings have long been
a topic of rumor and debate, from his pedestal
while the UNDP candidate, Chung Dong-young,
campaigns on a populist platform of peace and
"social justice".
US courts have played
right into the hands of Chung's people who are
pledging to pursue the policy of reconciliation
with North Korea as confirmed by the inter-Korean
summit this month between South Korea's President
Roh Moo-hyun and North Korea's leader Kim Jong-il,
by refusing to order a delay in his extradition.
If Kim's lawyers fail to win a postponement and no
one can dream up a convincing excuse for putting
off his return, he's likely to alight from a
plane, handcuffed between a couple of Korean
investigators, in the full glare of the Korean
media by the end of November.
While
"Sunshine" may not have all that much appeal among
voters fearful of giving away too much to North
Korea, the whiff of another scandal surrounding
Lee Myung-bak might well confirm a widespread
impression that he's cleverly enriched himself for
years through shrewd and sometimes shady financial
dealings.
The scandal will probably blow
away, like so many others here, if Kim just stays
in jail in Los Angeles until after the vote on
December 19, but Lee's foes see the spectacle of
prosecutors dragging Lee in for questioning before
then as a public humiliation that might be
extremely difficult to play down.
The
final decision on the timing of Kim's return may
be up to the State Department - obviously with
full coordination of the White House.
Desk
officers and spokespeople at the US State
Department appear to be under instructions to stay
as far away from the whole mess as they possibly
can. So far they've been quoted as coming out with
such diplomatic remarks as, "We're aware of the
matter," "We're studying it," "We'll look into
it," and finally, "We don't know of any decision
at this stage."
Presumably, the edict that
puts Kim on the plane would be signed by Secretary
of State Condoleezza Rice, but she's certainly not
talking about it. "She hasn't had time to read the
documents," one State Department "source" was
quoted in Seoul as saying.
The US
decision, though, will not rest on whatever Rice
thinks of the documents so much as on an
evaluation of whose side the US really favors in
the election. If the State Department says, fine,
we support law and order and our extradition
treaty with Korea, and we'll send him back after
the New Year, Chung Dong-young and his people are
going to view that decision as clear support for
the conservative Lee.
They will, then,
make that claim the basis of an attack on the US
for not fully supporting the "Sunshine" policy of
reconciliation with the North and probably not
really wanting to consider a peace treaty, that
is, a formal end to the Korean War.
The
issue of the treaty is already fraught with
sensitivities - the Koreans saying, let's declare
peace right now, before the next round of
six-party talks on North Korea's nuclear program,
while the US, through its ambassador to South
Korea, Alexander Vershbow, has been saying all
that will have to wait until North Korea really
and truly abandons its nuclear program.
If
Rice signs off on Kim's plane ride back to Seoul
before the election, however, conservatives,
members of the powerful Grand National Party, are
going to say the United States is betraying an
ally, selling out to the peace people and probably
selling out to North Korea too.
And if Lee
survives investigation under those circumstances
and wins the election, relations between a new
conservative government in Seoul and a once
hardline conservative one in Washington would be
clearly strained, at least until a
kiss-and-make-up Lee summit with President George
W Bush.
But just how culpable is Lee,
anyway? The scandal goes back a long way. A
transcript of a hearing in 2001 before Korea's
powerful Financial Supervisory Service (FSS)has
Kim saying that he owned all shares of BBK on
March 10 of that year and Lee "was not involved in
BBK in any capacity". The top FSS official,
however, seemed to have responded somewhat
cryptically when the question arose as to whether
Lee was also involved in BBK's transgressions.
"None that he knew," Kim was quoted as
saying as he searched for the best way to
characterize the FSS before he took it on the lam
to sanctuary in the US on a forged passport. So
what's going on, anyway?
Formally, Kim is
under investigation for allegedly embezzling
nearly 40 billion won (US$45 million) from BBK,
which he founded and served as president, while
manipulating stock prices and claiming that one of
his companies was about to get a huge infusion of
foreign funds.
The really damning stuff,
though, is that Lee's brother and brother-in-law
were owners of a motor vehicle parts company that
invested more than $20 million in BBK, and the
Korean media are saying that Kim has said that Lee
himself was the real owner of BBK.
The
link, as Lee's foes have been saying, was another
outfit, named the MAF Fund, of which Lee was
chairman. A member of the National Assembly, Suh
Hae-suk, came up with a brochure showing photos of
Lee and Kim, listing Kim as president of MAF,
which was purportedly really run by BBK. Another
mysterious company is there too - Lee and Kim's
LkeBank, said to have been the majority
stakeholder in the MAF fund.
Oh yes, for
good measure, Kim and a sister are also said to
have stashed more than $30 million into Swiss bank
accounts. Another National Assembly member, Choi
Sung, also of the UNDP, said US prosecutors had
been frustrated by a court decision, but a South
Korean official in Washington was quoted as saying
the US still wanted to confiscate Kim's assets on
behalf of cheated investors.
GNP aides
scoff at the pile-up of names, initials and links
as all a contrivance of politicos eager to seize
on any excuse to go after Lee. Until the scandal
started making headlines in the past few days,
they were more concerned about Lee's failed
attempt to get a meeting with Bush at the White
House. The approach to the White House was to have
been informal, a casual unscripted encounter while
Lee was ostensibly there to see someone else in
the White House.
The Lee people, though,
failed to grasp the subtlety of such a show and
let the press know that their man would be seeing
Bush. That was enough, according to reports in
Seoul, for Roh's people to complain about such a
show of favoritism - and for the White House to
drop the plan as if it had never existed.
Lee's aides may have learned a lesson
about politics in Washington. Now the question is
whether they know enough to figure out how to
persuade the State Department to waffle long
enough so Kim doesn't get back until well after
the election.
The Kim scandal comes with
one final little wrinkle. Kim could have delayed
his return himself but opted instead to drop his
appeal, giving the court the option of either
rejecting the South Korean demand for extradition
or setting the date to fall just before the
election.
Why?
"It is not
difficult to guess why," said Dong-AIlbo, a
leading newspaper. "He would have had to return to
Korea sooner or later under a bilateral treaty and
would lose his leverage in negotiations if he
returned after the presidential elections.
Presumably, after the election, whoever
wins, the victor will see Kim as dead meat, left
to the tender mercies of the judicial system,
forgotten and unmourned.
Journalist
Donald Kirk has been covering Korea - and
the confrontation of forces in Northeast Asia -
for more than 30 years. (Copyright 2007
Asia Times Online Ltd. All rights reserved. Please
contact us about sales, syndication and republishing.)
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