Unnamed official stationed abroad suspected of trading diamond miner stock


The Ministry of Foreign Affairs and Trade on Wednesday summoned an official from an overseas diplomatic mission suspected by the state watchdog of gaining personal profits through insider trading of CNK International stocks.

“As the Board of Audit and Inspection ordered disciplinary measures on the unnamed official, we summoned the official from Europe. The BAI’s audit will be strictly reflected on the future course of personnel management,” a ministry official said.

On Thursday, the BAI said in its audit result on the Foreign Ministry that the official, who used to work at a resources cooperation division at the Prime Minister’s Office in 2009, knew in advance that CNK International was pushing to win the diamond mining rights in Cameroon.

The official reaped more than 75 million won in profits as of Aug. 30, 2011 from trading a large amount of CNK stocks from May 31, 2009 to Jan. 10, 2011, the BAI said.

As the disciplinary statute has expired, the BAI asked the Foreign Ministry to take disciplinary measures against the official.

An aide to Kim Eun-seok, the suspended senior diplomat who was in charge of energy and resource diplomacy, reportedly sent an e-mail apology to all the Foreign Ministry staff Tuesday.

The aide allegedly started buying CNK stocks in August 2010 and made 35 million won in profits by selling them later. The official also used the ministry’s phone 1,585 times to trade stocks through a securities firm, the BAI said.

Meanwhile, Foreign Ministry spokesperson Cho Byung-jae said he does not intend to propose resignation of Foreign Minister Kim Sung-hwan over the CNK stock scandal.

“If I am included in the close aides (of Minister Kim), I do not plan to do so,” Cho told reporters.

Prosecutors started probing the CNK after the financial authorities filed a complaint against the firm last Wednesday over the suspicion that the company stock surged on the back of a foreign ministry press release that exaggerated the diamond reserves of its Cameroon mine. The press release was issued with the initiative of the fired energy ambassador, according to the audit results.

CNK International president Oh Deok-gyun and Cho Joong-pyo, formerly a vice foreign minister and minister in the Prime Minister’s Office, among others, are suspected of insider trading in connection with the scandal. Park Young-june, a former vice economic minister, is also under suspicion of playing a major role in the insider trading scheme.

By Kim Yoon-mi (yoonmi@heraldcorp.com)