Video arcade game scandal snowballs as prosecutors launch full investigation

South Korea's chief prosecutor on Monday ordered investigators to look thoroughly into allegations of influence-peddling in relation to a popular gambling arcade game, prosecution officials said.

The move came as opposition parties are stepping up their attacks on the Roh Moo-hyun administration, raising suspicions that the presidential office and some ruling party lawmakers are behind the recent rapid growth of "Sea Story," an arcade game they claim is causing a surge in gambling nationwide. "Prosecutor-general Choung Sang-myoung ordered Lim Chai-jin, chief of the Seoul district prosecution, to launch a full probe into the suspicions in the morning," said Kang Chan-woo, spokesman for the Supreme Prosecutors' Office.

Opposition lawmakers claim some ruling party lawmakers and close aides of Roh are suspected of peddling their influence to help the game pass screenings by authorities even though gambling is officially banned under South Korean law.

They also suspect Roh's nephew, Roh Ji-won, might have taken a role in the merger in May between Woojyun Systec, a venture company for which he temporarily served as an executive director, with Ziko Prime, the distributor of the game machine. He quit the company two months after the merger.

The nephew is also suspected of receiving suspicious stocks in March 2004 from Woojyun and wielding his influence to help the company obtain 2.6 billion won (US$2.7 million) of low-interest bank loans and free state subsides for promising small firms in February and May last year, although the company's stock price was nose-diving at the time.

Following the instruction by the top prosecutor, the Seoul Central District Prosecutors' Office said it has decided to organize a special investigative team composed of nine prosecutors to get to the bottom of the suspicions.

"In addition to the work of tracking the flow of money, we'll investigate all suspicions that have been raised so far," a senior prosecutor said, requesting anonymity. "Nothing has been cleared up regarding the suspicions," the official added.

The prosecution began a nationwide crackdown on gambling in arcades for adults last December.

On Sunday, prosecutors arrested the owners of three companies that produce and distribute video gambling machines, including "Sea Story," on charges of manipulating the winning average and other illegalities.

State auditors launched an on-site inspection of video gambling arcades in a preliminary step toward a full-blown investigation to see if government decisions related to the games were in order.

Calling the case "the biggest corruption scandal" involving the government to date, the main opposition Grand National Party (GNP) threatened to seek a parliamentary probe if state auditors or prosecutors fail to disclose the full truth behind the scandal.

"We (must) make it clear that Roh is responsible for the high-profile 'gambling gate,'" Rep. Kim Hyong-o, floor leader of the GNP, said. "We're afraid that the scandal might drive the government into collapse." However, Roh showed confidence despite the investigation, brushing aside the allegations that his nephew and close aides were linked to the scandal.

"There is nothing to worry about (concerning the allegations)," Roh said at a Cabinet meeting earlier in the day.

He urged the state auditors and prosecutors to clear all suspicions surrounding the gambling game.

"It will be difficult to endure the various suspicions (targeting me and my circle) for the time being, but when the truth is unveiled, this will serve as an opportunity for the government to prove its transparency," he stressed.

Seoul, Aug. 21 (Yonhap News)