Invest1 publisher2 min readPublished
Korea's new crime agency hands all 22 filled Seoul posts to former prosecutors
South Korea's new Major Crimes Investigation Agency gave all 22 Seoul office posts it has filled to former prosecutors. Companies under financial-crime investigation will face prosecutor-trained investigators at an agency built to split investigation from indictment.
The Investor · Invest desk
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What happened
- The agency was created partly as a rebuke of prosecutorial practice and is built on keeping investigation separate from indictment.
- The economic and financial crime bureau chiefs, Jang In-ho and Choi Jong-pil, were prosecutors seconded to the Defense Acquisition Program Administration and the Financial Services Commission.
- The antitrust bureau chief and 11 of 25 division chief posts are still vacant, leaving 12 Seoul seats open.
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Why it matters
- exposure Companies pulled into an economic or financial crime case at the Seoul office will face prosecutor-trained investigators at every level filled so far, so moving cases to a new agency has not changed who handles the file.
- constraint Outside hires can now bring the prosecutor share of the Seoul command down only to about 65%, so the separation principle depends on the charter split between investigating and indicting.
- decision Corporate legal teams have reason to keep counsel who know Seoul Central District Prosecutors' Office practice, since that office produced the agency's first and second deputy chiefs.
The report covers three deputy chiefs, six bureau chiefs and 25 division chiefs at the Seoul office [3][8], 34 posts in all [2]. Of those, 22 are filled and 12 are open, the open ones being the antitrust bureau chief and 11 division chiefs [1][3]. According to the Seoul Economic Daily, which reported the appointments citing legal community sources, the filled posts went to former prosecutors and not to judges, lawyers or police officials [1]. All 14 division chiefs named so far moved over from active prosecution service [8].
For companies, the relevant chain is economic and financial crime, and every level of it named so far was trained in the prosecution service. Lee Chun, the first deputy chief over that portfolio, headed the IT crime division at the Seoul Central District Prosecutors' Office and ran the Bucheon branch office [4]. Jang In-ho, head of the economic crime bureau, was a prosecutor seconded to the Defense Acquisition Program Administration [6]. Choi Jong-pil, head of the financial crime bureau, was seconded to the Financial Services Commission [6]. So was Shin Young-min, who runs the joint financial crime division [9]. Lee Jin-yong, the second deputy chief, takes corporate investigations alongside political corruption and used to head Seoul Central's tax crime division [5]. Antitrust has no bureau chief yet [7], but its third division is run by Choi Min-hyuk, who came from Seoul Central's fair trade investigation division [11].
I think firms should plan for financial-crime cases handled the way prosecution-led cases have been handled, because everyone who will direct them so far learned the work inside that service [1]. The paper reported that unnamed critics say the agency "has become little more than another prosecutors' office" [12]. Two things could make that view wrong. The 12 open posts could go to police, lawyers or judges [3]. And the agency's founding principle separates investigation from indictment [2], so the person who builds a file here is not, by design, the person who decides to charge.
The first has a ceiling. If every open post went outside the prosecution service, former prosecutors would still hold 22 of 34 seats, roughly 65%, including the first, second and third deputy chiefs [5]. The second depends on how cases pass from the agency to whoever indicts, and the report does not describe that handoff or the agency's caseload. For a company's legal budget, the ceiling argues for keeping counsel who know how Seoul Central works, since its IT crime and tax crime divisions produced the agency's first two deputy chiefs [4][5].
What to watch
- Who fills the antitrust bureau chief post and the 11 vacant division chief posts, and whether any come from the police, the bar or the bench.
- How the agency hands finished investigations to the office that indicts, which will show whether the investigation-indictment split works with this staff.