Editorial: Billion Profits, Investor Losses: Justice Nominee's Scandal

Nominee for Minister of Justice Kim Seung-won allegedly facilitated a request to the Ministry of Food and Drug Safety, enabling a major shareholder of a new drug company to sell their stocks to a listed firm just before clinical approval and profit 6.3 billion Korean won. Broker Yang, who mediated the request, received 600 million Korean won in investment funds from the shareholder as compensation. A recording between Yang and the shareholder also revealed intentions to give "20 million Korean won in cash to Seung-won." This led to a suspicious "money fest" tied to Kim's alleged intervention. During this period, small investors suffered heavy losses. Over 30,000 individual investors are estimated to have been harmed as the listed company's stock price, linked to the new drug firm, surged and plummeted. The structure resembles "stock price manipulation," where a few profit from insider information while retail investors bear the crash. On September 7, Kim claimed the Ministry of Food and Drug Safety's review was "fair," but approval followed after the ministry head relayed Kim's request. His alleged intervention appears to have acted as a "spark" for the stock volatility. Victims submitted a petition to the court that day, demanding an investigation into "undue influence." The drug company initially developed a treatment for shingles, a skin disease, but shifted to a COVID-19 treatment during the pandemic. However, side effects—including one out of five experimental mice dying and vomiting blood—were concealed during the clinical application to the Ministry of Food and Drug Safety. A public interest whistleblower stated, "It was shocking and alarming that a drug for human use could pass clinical trials through such a request." There is no evidence Kim verified the drug's safety, including side effects. How could he push for "fast processing" on a drug meant for human consumption? Typically, lawmakers meet constituents related to their committee or local districts. However, Kim has never served on the Health and Welfare Committee, which oversees the Ministry of Food and Drug Safety, and it is unclear if Broker Yang is a local constituent. From the start, forwarding a request from the "sister of an entertainment establishment owner" to an unrelated ministry was abnormal. Kim and the Democratic Party claim it was a "public interest civil complaint," framing it as routine legislative practice. This attempt to downplay the issue suggests they view the public as naive. Such evasion only deepens suspicions of misconduct.