S. Korea's Kim Accused of Taking Payoffs, Keeps Mum : Asia: President sets meetin with party leaders on predecessor's confession that he amassed enormous slush fund. Scandal widens.


Returning to a nation stunned by a former president's confession that he "governed" with a $653-million slush fund, South Korean President Kim Young Sam refused to comment Saturday on accusations that he received some of the secret money.

"We don't feel we have to disclose the sources of the campaign funds" that Kim used to get elected in 1992, a spokesman for Kim's ruling Democratic Liberal Party told a news conference.

Another ruling party leader said Kim will decide whether to disclose details of his campaign funds after prosecutors conclude investigations into illicit funds that former President Roh Tae Woo said he amassed while in office.

At the airport, Kim spoke only of South Korea's growing international stature before being whisked away. He scheduled a meeting with party leaders Monday to discuss both his two-week trip, to Canada and the United Nations, and Roh's tearful television confession and apology Friday.

Earlier, during a stop in Honolulu, Kim said that a pledge he made to refrain from accepting any political contributions after taking office should prove to voters that he has remained uncorrupted.

Already, Kim Dae Jung, who has run three times as a presidential candidate and is the nation's most famous foe of past authoritarian rule, has acknowledged accepting a Roh gift of $2.6 million. And Saturday, despite a lack of hard evidence, new accusations were made against Roh's wife, Kim Ok Sook.

KBS, the government radio and television network, reported that Kim Ok Sook built up her own slush fund with contributions from the wives of chairmen of the nation's business conglomerates. Her fund amounted to at least $261 million and it is believed she still holds it, KBS said.

Roh's wife met with between three and six of the wives each month and received a minimum of $130,000 from each of them each time, KBS said.

South Korean media reported that prosecutors plan to summon Roh for questioning within a few days and may decide to make him the first former president ever arrested--on charges of bribery and violation of a political funds law. Prosecutors also reportedly plan to take legal steps to confiscate the $222 million that Roh said he still holds as a leftover from his presidential slush fund.

Whom the broadening scandal will hurt most remains unclear. Even how the scandal erupted is cloaked in mystery.

In August, when a minister in Kim's Cabinet accused Roh of having amassed an illicit treasure chest as president, Kim fired the minister and discouraged any investigation of the charges. But when Park Kye Young, a member of the opposition Democratic Party, made a similar charge Oct. 19, Kim ordered a full investigation.

Prosecutors' revelations of a series of hidden bank accounts held by Roh pressured the former president to make his televised confession and apologize to the people in the hope of avoiding arrest, opposition legislators charged.

On Saturday, they claimed that Kim's agents were feeding information to Park with the aim of using him to discredit not only Roh but all older-generation politicians, especially Kim Dae Jung, President Kim's principal rival for the last quarter of a century.

Roh's confession that he still holds $222 million from the slush fund brought renewed criticism of South Korea's banking community.

Kang Sok Hoon, senior researcher at Daewoo Economic Research Institute, urged the National Assembly to make it illegal for "banks to seek deposits from illegal money and to prohibit banks from providing false names" to help customers open secret accounts.

Although President Kim carried out a reform in 1993 that was supposed to halt concealment of the identity of account holders, the practice remains widespread. Roh is believed to have used fake names to conceal hundreds of bank accounts and records of ownership of real estate, stocks and bonds.

"We should refrain from overheated competition to induce deposits. Banks should be reborn as institutions for ordinary people, not for powerful people," said Park Tong Hoon, planning section chief at Korea Commercial Bank.

Ahn Kang Min of the prosecutor's central investigative department said South Korea was studying whether to ask Switzerland to determine whether Roh held any secret accounts there.

On Saturday, prosecutors announced they had uncovered three more secret Roh bank accounts, bringing to $150 million the amount of slush funds they have located. They identified the Donghwa Bank as having $107 million worth of Roh's funds hidden in accounts there.

Korean media also published a series of analytical articles purporting to show how the president of a country where bribes are considered essential to win contracts or permits from the government theoretically had endless opportunities to receive bribes.

The newspaper Kukmin Ilbo, published by one of South Korea's largest Protestant churches, reported, for example, that Seoul spent about $20 billion on defense projects while Roh was in office. At between 3% and 5%--reportedly the usual commission for such purchases--those projects alone would offer an opportunity for kickbacks to politicians or the president of between $590 million and $980 million, the newspaper calculated.

Other actions taken while Roh was in office--all of which reportedly brought kickbacks to government officials--included contracts for 17 large power plants, authorization of 139 golf courses, approval of construction of a massive offshore airport, establishment of 26 financial institutions and the licensing of a new TV network, the newspaper said.

In addition to specific bribes, the Kukmin Ilbo said, chairmen of at least 30 large conglomerates gave Roh "holiday gifts" similar to the $34 million that Chung Ju Yung, founder of the massive Hyundai conglomerate, declared publicly in 1992 that he had delivered to Roh when he was in office.

Roh, in his Friday confession, described his slush fund as illegitimate but "necessary" in the midst of the "political and electoral culture that existed when I was in office."

The former president said he used the money as a "governing fund"--meaning, said one analyst who asked not to be named, "creating and maintaining power."

Roh's ruling party, originally called the Democratic Justice Party, won only a third of the seats in a 1988 National Assembly election--a situation that left the president at the mercy of three opposition parties. No evidence of National Assembly bribery has been uncovered, but the potential need for it was obvious.

Two years later, Roh persuaded both Kim Young Sam and Kim Jong Pil to bring their opposition forces into the new ruling party that was dubbed the Democratic Liberal Party.

Just providing funds to underwrite regular expenses of the party's 237 chapters was estimated to have cost Roh at least $160 million over five years, the Kukmin newspaper reported. Then, too, five elections were held, creating a demand for an untold amount of campaign funds, the newspaper added.

So pervasive is gift-giving that presidents are allegedly expected to hand over extravagant sums of money to ministers who leave the Cabinet as a "consolation," or reward, for their toil.

Roh was "very frugal" with his departing ministers, but former President Chun Doo Hwan, whom Roh joined in a 1980 coup that put Chun in power until Roh took over in 1988, "handed out gifts like a gangster," said one television political reporter who asked not to be named.

Chun's record, the reporter said, was $2.6 million to an outgoing defense minister.

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