South Korea goes after the fortune of Chun Doo-hwan, its last military strongman

August 14, 2013

South Korea’s last dictator lives in an L-shaped mansion protected by 15-foot stone walls and a plainclothes security team. He almost never goes outside, his longtime lawyer says, given the scrutiny he’d face. Highlighting the extent of change in the nation he once ruled, Chun Doo-hwan is whiling away his golden years in a home that’s a virtual prison.

Many South Koreans view Chun as the face of a bygone but still-painful era — one filled with military coups, repression and flagrant corruption. The nation democratized almost immediately after Chun left office 25 years ago, and today is a vibrant multi-party state where presidents serve single five-year terms and shoving matches occasionally enliven National Assembly debates.

But authorities here say that Korea’s transformation still requires a final step: full justice for past wrongdoings.

That’s why prosecutors are taking steps to reclaim the small fortune in bribes that Chun collected while in office. A 1997 supreme court ruling ordered him to pay back the money, about $200 million, but he has returned only a quarter of it. He says he doesn’t have the rest.

Lawmakers here say Chun has pulled off a final heist, stashing his fortune in paper companies associated with family members. They note that Chun still lives lavishly, though quietly. He golfs at exclusive clubs. He was spotted last year at a wedding ceremony for his granddaughter at the Shilla, perhaps the most opulent hotel in Seoul.

The furor over a rarely seen 82-year-old reflects a generational shift in which the many who once felt repressed by Chun’s rule now hold positions of power.

The outcry is also a result of Chun’s image. Koreans regard him as a Nixonian schemer, one whose corruption was legendary even in an era known for political payoffs. His disrepute is wide enough that last year, Koreans flocked to theaters to see “26 Years,” a revenge flick in which a team tries to assassinate Chun.

In a nation with deep ideological differences, there’s near-consensus about the effort to reclaim Chun’s money. This summer, conservatives and liberals in the National Assembly cooperated on legislation that allowed investigators to drag away assets of Chun’s family, even without proof that they were illegally obtained.

In July, a 90-person team barged into Chun’s house and pulled out cabinets, paintings, jewelry and safes. Authorities froze some of his wife’s assets and searched the homes of 29 family members and associates, according to news reports. Media members remain camped out on the edge of Chun’s property, where with a line of tripods and stepladders they track comings and goings.

“Mr. Chun isn’t technically under house arrest,” said his attorney, Jung Joo-kyo, “but he is not able to easily step out of his house” because of the media.

The raids are just the latest of Chun’s legal troubles. He spent two years in the mid-1990s wearing rubber shoes and a prison jumpsuit, the result of a lengthy government investigation that found him guilty of mutiny, insurrection and bribery. His sentence — life imprisonment, reduced from a death sentence — was commuted in 1997.

“Chun had ruled in a truly militant way,” said Choi Jang-jip, a professor emeritus of political science at Korea University. “You can safely say that Chun Doo-hwan is the worst president Koreans have ever seen.”

Symbol of nation’s problem

To understand why Chun is so loathed, one must look at the period in which he came to power — an awkward national adolescence in which Korea was booming economically but thirsty for democracy. Chun helped maintain the growth, but historians say he’s remembered more for holding back a nation from the liberalization its people wanted.

Chun grabbed power after the assassination of longtime strongman Park Chung-hee in 1979. He cemented his control with crackdowns on student protesters who wanted free elections and the release of dissidents.

Amid his rise, Chun oversaw the bloodiest incident in South Korea since the war, when special forces in 1980 suppressed an uprising in the southern city of Gwangju. Several hundred protesters were clubbed and machine-gunned to death.

Still, when investigators in the 1990s pored over the details of his reign, their most galling discoveries dealt with graft. Interviewing witnesses and scouring financial records, prosecutors found that 32 companies, including Samsung and Hyundai, had paid millions to Chun nearly annually. As part of their search, prosecutors discovered 10,000-won notes (worth about $9 each) belonging to Chun stuffed into 25 apple boxes in a cement warehouse.

Chun’s lawyer, in documents he submitted to the court, said the former president used nearly all of his money for political purposes while in office. The money now in Chun’s family, the lawyer said, was inherited from his wife’s father.

“Mr. Chun is willing to pay all the leftover money he owes, but he doesn’t have wealth to his name,” said Jung, the lawyer. “His wife has money, and his family has some. But he personally doesn’t have the ability to repay.”

Chun is hardly the only corrupt leader in South Korea’s history, but he has become the symbol of the problem. His predecessor, Park, was responsible for massive graft schemes, but many Koreans consider him a benevolent father figure who masterminded the postwar rise. Park’s daughter, Park Geun-hye, became president this year.

Domestic outcry over Chun’s unpaid debts soared in June after an independent broadcast company, Newstapa, linked a secret offshore company to Chun’s eldest son. The company was set up in 2004, just as another of Chun’s sons had been charged with $15 million in tax evasion. Half of that came from Chun Doo-hwan’s slush funds, a court later ruled.

The eldest son, Chun Jae-kook, denied that the offshore company has anything to do with his father. But lawmakers say they want to investigate.

Reconsidering history

Choi Jae-sung, the assemblyman who drafted the bill, was a university student who organized protests during Chun’s rule.

Choi spent much of college “living on the run,” he said recently. He used fake names and almost never attended class. Police arrested him in 1987 at a restaurant near his school. A year later, Chun voluntarily left office.

“South Korea’s democracy has been established very quickly,” Choi said. “But I would say this is a process by which Korea is now evaluating its own history. You can’t have full democracy without justice.”

Yoonjung Seo contributed to this report.

Chico Harlan covers personal economics as part of The Post's financial team.
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