Kangwon Land hiring scandal in South Korea Requires two indictments

A hiring scandal at South Korea’s only casino accessible to locals, Kangwon Land (pictured), has reportedly resulted in the indictment of two lawmakers from the nation’s conservative Liberty Korea Party. The indictments bring to a close an investigation by an independent probe team that lasted two and a half years.

KBS World Radio, the official international broadcasting station of South Korea, reports that that Representatives Yeom Dong-yeol and Kweon Seong-dong were on Monday charged by prosecutors with business interference and abuse of power, but were not detained. The two opposition lawmakers will reportedly stand trial for allegedly exerting pressure on the state-run casino operator to hire approximately 50 people, including acquaintances’ children, from November 2012 to April the following year.

According to KBS, the prosecution intended to arrest the pair, however, the consent to place Yeom under arrest was refused by parliament, while a request for an arrest warrant for Kweon was dismissed by the court. Under law, parliament must first consent to the arrest or detainment of incumbent lawmakers, due to their immunity status, during an active session of the National Assembly.

According to GGRAsia, earlier media reports in the country indicate that on March 8, in addition to the offices of the Ministry of Culture, Sports and Tourism and the headquarters of Kangwon Land Inc., the Supreme Prosecutors Office executed search warrants at the offices of the two National Assembly representatives two days prior. The news agency further communicates that according to a report at the time by the Yonhap news agency, citing the office of the president, also in March, the Democratic Party’s parliamentary leader from 2015–2016 and the current president of South Korea, Moon Jae-in, had ordered 226 employees of the gambling venue be dismissed after an investigatory probe found that they obtained their jobs by way of nepotism.

The casino operator, which is located some 93 miles from the Asian nation’s capital Seoul, last year admitted that as far back as July 2011 up until February 2014, 95% of the staff hired to work at Kangwon Land were chosen either because of a personal relationship with the entity’s former Chief Executive Officer Choi Heung-jip or for their political connections.

Last year in December, Choi Heung-jip was arrested after the alleged illicit hiring of staff at the request of local bigwigs and politicians, including Rep. Yeom Dong-yeol and Rep. Kweon Seong-dong. At the time, local media reported that of the 5,200 applicants eyeing positions at Kangwon Land Inc., between 2012 and 2013, a mere 518 were hired by the company, allegedly due to their ties to people in power.

Kangwon Land Casino opened in 2000 and currently features 293,757 square feet of gaming with some 180 gaming tables and approximately 1,360 slots. The property is also one of the most lucrative casinos South Korea having detailed (pdf) a 4Q 2017 operating profit of roughly $73.5 million courtesy of some $353.6 million in gaming revenues alongside a little over $21 million in takings from non-gambling activities.

However, in May this year, the operator reported a 30.3% reduction in profit for Q1 2018, which were attributed in part to a decline in the operator’s Q1 gaming revenue, which dropped 7.2% to KRW 378.4 billion this year.