Prosecutors were expected to seek an arrest warrant Tuesday for a key suspect in a corruption-laden urban development project rocking South Korean politics, a day after detaining him for questioning upon his return from the United States.

Nam Wook was put under emergency arrest upon his arrival at Incheon International Airport early Monday morning and underwent questioning. As the emergency arrest is set to expire Wednesday morning, prosecutors are expected to seek a formal arrest warrant for him sometime Tuesday.

Nam, a lawyer, is believed to be holding the key to resolving suspicions over how a previously unheard-of asset management firm, Hwacheon Daeyu, and its seven affiliates reaped astronomical profits from a 2015 project to develop the Daejang-dong district in Seongnam, south of Seoul, into an apartment complex.

Partners of the project, including Nam who owns one of Hwacheon Daeyu's seven affiliates, were accused of colluding with Yoo Dong-gyu, acting president of Seongnam Development Corp., to have the asset firm take part in the lucrative project.

Yoo is widely regarded as an associate of Gyeonggi Province Gov. Lee Jae-myung, who is now the ruling Democratic Party's candidate for next year's presidential election. Lee was the mayor of Seongnam when the development project was launched.

The scandal has received intense media coverage amid questions about its potential impact on Lee and next year's presidential election. The main opposition People Power Party has claimed Lee was behind the whole scheme.

In a parliamentary audit of his government Monday, Lee apologized for "appointing the wrong people" but claimed that he did not consider Yoo to be "a close aide."

Nam joined the city-run project as a private partner and made about 100.7 billion won ($84.14 million) through his company with a paid-in capital of 87.21 million won.

In a recent media interview, Nam denied any wrongdoing, claiming he had been sidelined from the project in its early stages. He shifted the blame to other key figures, including Yoo and Kim Man-bae, owner of Hwacheon Daeyu.

Yoo has already been arrested on charges of bribe-taking and breach of trust. Prosecutors had also sought an arrest warrant for Kim last week, but a court rejected the request, saying that the prosecution failed to present sufficient grounds for his arrest.

During the media interview, Nam also claimed to have heard his partners discussing raising 35 billion won in order to pay seven influential people 5 billion won each in bribes.

In Monday's questioning, Nam reportedly told investigators he was aware that the bribes were actually handed to only two of the people and that he prepared the money at Kim's request.

Whether a court issues an arrest warrant for Nam is expected to be critical in determining the direction of the probe, as the warrant rejection for Kim, another key suspect, was widely seen as having dealt a major blow to the high profile investigation.

Yoo, meanwhile, filed a request on Monday asking for a Seoul court to review the legality of his arrest made on Oct. 3. A hearing will be held later Tuesday.

Prosecutors on Tuesday also raided the offices of Seongnam City Hall for the third time in less than a week to secure additional email records of employees involved in the development project.

Investigators on Friday and Monday seized documents and other materials from the municipality's city project team that had been in charge of establishing and authorizing details of the project, as well as the network division containing digital data about the city's electronic decision-making process and email communications.

As with the earlier raids, the mayor's office was not subject to the search and seizure procedure.

Prosecutors were also found to have raided an office of the state-run Cultural Heritage Administration on Friday to verify allegations that Hwacheon Daeyu paid a 5 billion-won bribe to the son of Rep. Kwak Sang-do, in the name of severance pay, to curry favor with the lawmakers.

Investigators suspect that Kwak offered business favors to Hwacheon Daeyu in the past while serving as Cheong Wa Dae's senior secretary for civil affairs and a member of the National Assembly's culture committee. The lawmaker's son previously worked at the asset management company for about seven years. (Yonhap)