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Protesters demand Chun's slush fund be recovered. Photo: AP

Hunt for former South Korean tyrant Chun Doo-hwan's HK$1.1b cash stash

Prosecutors have less than four months to get back HK$1.1b that Chun Doo-hwan amassed during his reign - but he says he is broke

South Korea

Former South Korean President Chun Doo-hwan owes the country 167.5 billion won (HK$1.1 billion) that he was found to have amassed through corruption during his 1980s rule, but he insists he's broke. Prosecutors have less than four months left to prove him wrong.

A statute of limitations will soon wipe away Chun's obligation to pay back the money, to the chagrin of South Koreans who remember the military dictator for not only his cozy relationships with businessmen but also for a deadly crackdown on pro-democracy protesters.

Lawmakers plan to meet today to debate legislation that could extend the search and hold his family accountable for the money. But even if it passes, such retroactive changes could be rejected in court.

Last month, the new chief of the state prosecution office urged an "extraordinary" push to collect from the 82-year-old, who seized power in a 1979 army coup and ruled South Korea until early 1988.

Chun's departure as president marked the end of military rule and the beginning of democracy in South Korea. In 1996, he was convicted of corruption and for his role in the 1980 crackdown, which left about 200 people dead in the southwestern city of Gwangju. He was sentenced to death, though he received a reduction in sentence and later a pardon.

He also was ordered to pay back the 220.5 billion won "slush fund" that officials said he had amassed from dozens of businessmen in return for government contracts and other favours. He has since returned 53 billion won.

Prosecutors can still recover funds because under the law, the statute of limitations is extended three years every time an asset is seized. That has happened several times: a Mercedes-Benz was seized in 2000, and in 2010 he voluntarily paid 3 million won in what was seen by many as an effort to prevent authorities from confiscating larger assets.

In his 1996 bribery trial, Chun admitted receiving a massive slush fund when he took power, but he said he was simply following the practice established by his military predecessors.

"When judged by today's yardstick, it may be wrong, but in those days it was customary to receive donations," he said during his closing arguments.

By 2003, Chun said the money was gone. He was ridiculed when he told a court hearing that year that he had less than US$300.

Chun reportedly said he was living off money from his sons and supporters, but wouldn't ask his sons to help pay his debt because "they have to make a living, too".

Chun's wife said last year the ex-president had paid all he could. But then it was reported he played golf and had a whisky party at an island resort.

Opposition lawmaker Jun Byung-hun claims Chun's three sons received assets from their father now worth more than 300 billion won.

The former leader's eldest son, Chun Jae-kook, runs a publishing company that posted revenue of 44 billion won last year.

Jun said another son, Chun Jae-man, operates a California winery worth 100 billion won with his father-in-law, businessman Hi Sang-lee.

The proposed bills in the National Assembly would extend the statute of limitations to 10 years, instead of the current three years, every time an asset is paid or confiscated. They also would allow authorities to collect from Chun's family members if he can't pay.

Kim Sung-joo, a political scientist at Seoul's Sungkyunkwan University, expressed scepticism that all Chun's money would be collected, saying senior officials who once served him still held sway and would be reluctant to press the matter.

"Without closing this chapter on Chun and his slush money, South Korea can't establish a sense of social justice that future generations can be proud of," Kim said.

This article appeared in the South China Morning Post print edition as: Hunt for former tyrant's cash pile