Ethics panel to mull disciplinary action against lawmaker over cryptocurrency scandal, but expulsion unlikely

A special parliamentary ethics committee is set to review two motions calling for disciplinary action against Rep. Kim Nam-kuk over dubious cryptocurrency transactions, yet it is unlikely the embattled lawmaker will be unseated.

Kim left the main opposition Democratic Party (DP) to become an independent after it was revealed he owns a significant amount of coins, raising concerns about conflicts of interest and the source of the funds.

Amid growing criticism that he is attempting to evade responsibility by simply leaving the party, the DP submitted a motion to the Special Committee on Ethics on Wednesday, separate from the ruling People Power Party’s (PPP) earlier motion.

The bipartisan committee, which is evenly divided by the PPP and DP, has the power to take discipline action against sitting lawmakers who are immune from arrest or detention while the National Assembly is in session.

Under the relevant parliamentary law, Kim may face one of four disciplinary actions — a warning, an order for an official apology, suspension of legislative activities for up to 30 days, or an expulsion from the National Assembly.

Nonetheless, it may take up to 80 days for the motion to be sent to the National Assembly’s general meeting, and the likelihood of the expulsion motion being passed is uncertain, as it requires at least two-thirds approval.

Since the special committee voted to unseat a former lawmaker, Kang Yong-seok, for sexist and derogatory remarks in 2011, no other expulsion motion has been passed through the committee. The motion against Kang was ultimately voted down during a plenary session.

The PPP has called for Kim to be stripped of his parliamentary seat for violating parliamentary ethics rules, while the DP has taken a cautious stance, citing the ongoing prosecution investigation on Kim.

The first-term lawmaker has come under fire following revelations that he owned around 800,000 Wemix coins in 2021, worth around 6 billion won (US$4.5 million) at the time, a significant amount inconsistent with his frugal image. Wemix, the cryptocurrency operated by a gaming firm, was delisted in November 2022.

The transactions were reported to the Financial Services Commission’s Financial Intelligence Unit, which classified the withdrawals as suspicious transactions and reported them to the prosecution.

On Monday, prosecutors raided two leading cryptocurrency exchanges, Upbit and Bithumb, as part of the investigation into the snowballing suspicions surrounding Kim.

The young lawmaker has stated he did not cash out the assets but instead transferred them to another exchange, without clarifying the exact amount of his crypto assets. He further claimed he was not required to report such activities.