Ex-Gyeonggi vice governor gets 9 1/2-yr sentence in N.K. remittance, graft case

Former Gyeonggi Province Vice Gov. Lee Hwa-young, who is said to be close to opposition leader Lee Jae-myung, was sentenced by a court on Friday to nine years and six months in prison on multiple charges, including collusion in an underwear maker’s unauthorized remittance to North Korea.

The Suwon District Court handed down the sentence, finding Lee Hwa-young guilty of colluding in Ssangbangwool Group’s transfer of US$3.94 million (about 5.38 billion won) to North Korea between 2019 and 2020, bribery and political fund law violations.

The court also imposed a fine of 250 million won ($183,000) on him and ordered the forfeiture of 326 million won.

Lee Hwa-young was indicted for violating the Foreign Exchange Transactions Act in connection with Ssangbangwool’s transfer of $8 million to the North. Prosecutors claim $5 million of the money was intended to help Gyeonggi’s smart farm support program in North Korea, and the rest was to facilitate then Gyeonggi Gov. Lee Jae-myung’s planned visit to Pyongyang. Kim Seong-tae, former chairman of Ssangbangwool, allegedly delivered the money to Kim Yong-chol, chairman of North Korea’s Asia-Pacific Peace Committee, on behalf of Lee Jae-myung and the provincial government.

Lee Hwa-young served as vice governor while Lee Jae-myung was governor of Gyeonggi Province, which surrounds Seoul, from 2018-2021.

The court recognized only $3.94 million of the $8 million the prosecution stated in the indictment as illegal funds smuggled overseas.

Lee Hwa-young was also charged with receiving illicit political funds amounting to 334 million won from Ssangbangwool, including 259 million won worth of bribes provided through methods such as corporate card and vehicle usage, between July 2018 and August 2022. In addition, he is suspected of inciting Ssangbangwool’s Vice Chairman Bang Yong-cheol to destroy corporate data related to his corporate card use.

The court said it appears that Lee had received bribes and political funds for a long period of time without any sense of compunction, considering his past behavior.

“The defendant has worked for our society as a high-ranking official for decades but he is highly likely to be criticized in this regard,” the court said.

“He was supposed to be careful within the boundary of the law in the case of crimes under the Foreign Exchange Transactions Act. But he ended up committing a crime of providing funds to North Korea by using his public position. Nevertheless, he has denied the crime with unreasonable excuses throughout the court hearing, thus deserving severe punishment,” it said.

The court acquitted Lee of parts of his graft and political fund and foreign exchange law violation charges.

The ruling came about one year and eight months after Lee was indicted in October 2022. Prosecutors demanded imprisonment of 15 years for him in a previous hearing in April. He has denied the charges. He said once that he had reported Ssangbangwool’s North Korean remittance to Lee Jae-myung but reversed his statement later.

Following the conviction of Lee Hwa-young, the prosecution is expected to wind up its investigation into Lee Jae-myung for a possible indictment on allegations that he, as governor of Gyeonggi, asked Ssangbangwool to illegally transfer $8 million to North Korea. The prosecution requested an arrest warrant for Lee Jae-myung in September last year on multiple charges, including one related to the North Korean remittance case, but the Seoul Central District Court refused to approve the warrant.