Ex-gov't official arrested for bribe allegations involving Hyundai

South Korea's prosecutors arrested a former government official for allegedly receiving bribes from Hyundai Motor Group, prosecutors said Monday.

The prosecutors executed an arrest warrant issued for Byeon Yang-ho, a former director-general of the Ministry of Finance and Economy and the current head of local equity fund Vogo Investment, earlier in the day on the suspicion that he received bribes from Hyundai Motor from 2001 to 2002, Chae Dong-wook, a top prosecution official said.

Prosecutors raided Byeon's residence and his office in the morning, Chae said. They will decide wether to withhold the former official for investigation by Wednesday.

Kim Dong-hoon, the former head of a local accounting firm under suspicion of relaying Hyundai's bribes to Byeon and other government officials, was arrested two months ago for receiving 4.16 billion won (US$4.31 million) in lobbying funds and rewards from July 2001 to June 2002 from Hyundai.

Hyundai Motor, which controls about 70 percent of the domestic auto market, is South Korea's second-largest conglomerate and the seventh-largest automaker in the world.

The group recently became entangled in a political bribery scandal. Group Chairman Chung Mong-koo was arrested on April 28 on charges of embezzlement and breach of trust.

Chung, who has been in custody since his arrest on April 28, is accused of misappropriating 100 billion won in company funds and causing over 210 billion won in damages to his company's coffers.

Prosecutors believe Chung used the money he amassed to bribe public officials and politicians in return for various business favors, including providing construction permits and debt reduction for affiliates.

SEOUL, June 12 (Yonhap)