Appellate court overturns ruling on Deutsche Motors case

Focus shifts to impact of verdict finding man guilty of aiding stock manipulation on first lady

An exterior view of the Seoul Central District Court (Herald DB)

The Seoul Central District Court on Thursday overturned the lower court's ruling on a man surnamed Son, who in 2023 was acquitted of charges of providing scammers linked to a 63.6 billion won ($47.4 million) investment fraud in the early 2010s with a trust account, allowing them to manage assets on behalf of himself or the trust's beneficiary.

The case has been drawing public attention as President Yoon Suk Yeol's opponents claim that first lady Kim Keon Hee was also suspected to have been linked to these scammers and an invest scheme involving listed imported car distributor Deutsche Motors.

At the appellate court, Son was found guilty of aiding and abetting the stock manipulation crime and was handed down a suspended sentence. Kim and her mother Choi Eun-soon, were also suspected of trusting their accounts to the scammers involved in the investment fraud.

Kim and Choi's trust accounts had reportedly allowed them to take a combined profit of 2.29 billion won, but the public prosecution in December 2021 did not accuse Kim and Choi of any crime citing lack of evidence of their involvement in the scheme.

Kim's husband Yoon was then a prosecutor general who led the nation's public prosecutors.

The presidential office on Thursday declined to comment. The prosecution, on the other hand, stated that the Son and Kim cases cannot be judged on the same standards.

A man surnamed Son (center, front) on Thursday walks out of the courtroom after an appeals court verdict over his alleged aiding and abetting of a pump-and-dump scheme on South Korea's stock market in early 2010s. (Yonhap)

For months, the Democratic Party has constantly called for a special counsel probe into allegations surrounding Kim, including her possible involvement in the pump-and-dump allegation.

In January, the Democratic Party said in a statement that the prosecution has been selective on indicting individual investors, saying that none of six individuals -- including Kim and Choi -- who assigned the scammers to administer their accounts and took profits from the scam were indicted. The prosecution instead brought to trial some other individuals who rather took losses.

Most recently, the party asked National Assembly Speaker Rep. Woo Won-shik to table the renewed special probe bill into the first lady before the Chuseok holiday, but he rejected their request Wednesday.

Earlier this week, Kim virtually averted the indictment regarding her alleged antigraft rule violation by receiving luxury gifts valued up to 5 million won combined including a Christian Dior bag behind the hidden camera.

The spy camera scheme, orchestrated by Korean American pastor Choi Jae-young and news outlet Voice of Seoul in 2022, fueled speculations that Kim's reception of a gift could be construed as a crime.

The prosecution, however, dropped charges against Kim, given that a public official's spouse is not punishable under the current antigraft rule in Korea. Its external panel also viewed Kim as not being punishable.

By Son Ji-hyoung(consnow@heraldcorp.com)