Many South Koreans, under continuing duress from the COVID-19 pandemic, have an additional cause for discomfort these days: a housing development scam unfolding in a satellite city of Seoul where a handful of unknown people made undeserved profits of an astronomical scale. Their adrenaline goes up when they imagine the possible involvement of Lee Jae-myung, the ruling party’s presidential election front-runner, in this affair in his political hometown.

The Daejang-dong project in Seongnam, Gyeonggi Province, is probably the last hazard the 56-year-old governor, a maverick politician who built his career with unconventional wit and appeals to the lowest strata of society, should negotiate before coming to the final race next spring.

Opposition contenders are primarily blaming Lee, who was Seongnam mayor from 2010-2018, for creating the fantastic project producing up to 1 trillion won ($840 million) in dividends bagged by amateur developers. The key figures are a former journalist who assembled investors in the joint official-private project and a longtime aide to Lee who drew up the financing blueprint for Daejang-dong.

Yoo Dong-gyu, appointed by Lee as planning director of Seongnam Development Corp. in 2015, was arrested by the prosecution last weekend on suspicion of aggravated bribery and breach of trust. More arrests are expected, although how wide the probe will be is hard to guess.

Every stage of the project process defied established practices from screening…

Read more…