South Korea’s largest business lobby group claimed Thursday that it was instructed by the presidential office to solicit corporate donations for Choi Soon-sil, a close friend of President Park Geun-hye.

A top standing executive of the Federation of Korean Industries -- Vice Chairman Lee Seung-cheol -- made the testimony, appearing as a witness at Choi’s trial at the Seoul District Court.


The FKI, which represents some 600 local businesses here, is suspected of assisting Choi in her fundraising for two nonprofit foundations -- K-Sports and Mir. The entities, believed to have been established and controlled by Choi, are suspected to be covers for channeling money and contracts to her private business interests.

“We followed the instruction of An (Chong-bum) who told me over the phone to help establish cultural and sport foundations of a 30 billion-won fund scale,” Lee said at the hearing. “An said it was the president’s order.”

An Chong-bum is Park’s former secretary, and is standing trial with Choi for abuse of authority and extortion with regard to the donations, totaling 77.4 billion won, from over 50 local businesses to Choi’s foundations. 

President Park has been named by state prosecutors as an accomplice to Choi and An, and has been suspended from work by the parliament on Dec. 9. She is now standing an impeachment trial at the Constitutional Court.

The prosecutors allege that Lee Seung-cheol assisted Choi in creating the troubled foundations and funneling the funds from its member companies to the entities. 

Special Counsel Park Young-soo, who is now investigating the alleged massive corruption surrounding the president and Choi, now suspects shady donation-for-favors arrangements between Park and the corporate contributors of Mir and K-Sports.

The de facto chief of Samsung Group, Lee Jae-yong, is currently under investigation for the suspicion. The country’s largest conglomerate was the biggest of the 53 donors.

FKI’s Lee stressed during the court hearing that his organization was under pressure from the presidential office, a victim rather than an accomplice to any crime.

He also said that the lobby group was told to increase the fund amounts to 50 billion won and get more companies to donate, including South Korea’s largest internet service provider KT and leading cosmetics maker Amorepacific. The directive was also from Park, who saw the initial amount of 30 billion won as insufficient, Lee said.

The FKI is now on the verge of collapsing. 

Amid growing criticism, several key firms, including Samsung and LG have decided to end their membership of the group. 

By Bak Se-hwan (sh@heraldcorp.com)