What to know about South Korean President Park Geun Hye's influence-peddling scandal

South Korea's Park Geun Hye removed from office.VIDEO: REUTERS
Supporters of President Park Guen Hye clash with police outside the Constituational Court, after news that the vote to impeach the South Korean leader has been upheld.
Protestors wearing masks of South Korean President Park Geun Hye (bottom) and her confidante Choi Soon Sil.
Protestors wearing masks of South Korean President Park Geun Hye (bottom) and her confidante Choi Soon Sil.PHOTO: AFP

South Korean President Park Geun Hye, the country's first female president, is facing the biggest political crisis since coming to power in 2013.

The parliament voted on Dec 9 to impeach her after she was accused of colluding with her longtime friend Choi Soon Sil to pressure big businesses to make contributions to non-profit foundations backing presidential initiatives.

President Park, whose father ruled the country for 18 years after seizing power in a 1961 coup, has denied wrongdoing but apologised for carelessness in her ties with Choi, who is on trial for fraud and abuse of power.

Here's a quick guide on the brewing scandal and the allegations facing President Park and Choi:

What prosecutors say?


Former presidential aide Jeong Ho Seong is escorted by police following his arrest in Seoul on Nov 6, 2016.  PHOTO: AFP


Former presidential aide An Chong Bum. PHOTO: CCTV TWITTER  

Prosecutors charged Choi and former presidential aide An Chong Bum with abuse of power by pressuring companies to contribute funds to foundations at the centre of the scandal. Another former aid Jeong Ho Seong was indicted for leaking classified information to Choi. Prosecutors said based on the evidence secured to date, the president was found to be in complicity with the three people to "a considerable degree".

Who is Choi Soon Sil?


Choi Soon Sil arriving for questioning at a prosecutor's office in Seoul, South Korea, on Nov 1, 2016. 

Ms Choi, 60, has been a close friend of Ms Park, 64, for more than 40 years. She is the daughter of late religious leader Choi Tae Min, who set up a cult-like group known as the Church of Eternal Life. He befriended Ms Park after her mother was killed in 1974 taking a bullet meant for her father, then president Park Chung Hee. Mr Choi claimed that the late first lady had appeared to him in a dream, asking him to help her traumatised daughter, then 23. He became a longtime mentor to Ms Park, who forged a strong bond with his daughter that endured after Mr Choi 's death in 1994.

Ms Choi has a 20-year-old daughter. In 2014 when she ended her second marriage, she declared she had 36.5 billion won (S$44.5 million) worth of assets, including several properties. She left South Korea for Germany in September when news of the scandal first emerged.

How close are the two friends?


Protesters wearing cut-outs of South Korean President Park Geun Hye (right) and Choi Soon Sil attend a protest denouncing Park over a recent influence-peddling scandal in central Seoul, on Oct 27, 2016. 
PHOTO: REUTERS

The precise nature of the friendship has triggered media frenzy in South Korea, with lurid reports of religious cults and rituals. The media has portrayed Ms Choi as a Rasputin-like figure who wielded an unhealthy influence over Ms Park.

Besides playing the role of a spiritual guide to the president, Ms Choi also reportedly served as her personal secretary when she entered politics in 1998, and nursed her back to health after her face was slashed by a man at an election rally in 2006. She reportedly accompanied Ms Park to events and media interviews too. Ms Choi apparently started keeping a low profile after Ms Park was elected president in 2012.

What are the allegations?


People chanting slogans as they march toward the Presidential Blue House during a protest calling South Korean President Park Geun Hye to step down in Seoul, on Nov 19, 2016. 
PHOTO: REUTERS

Editing the president's speeches: 

Ms Choi had a say in some of Ms Park's speeches. She told Segye Ilbo newspaper that she was able to help Ms Park "find the right words to express herself" as she "knows what is in her mind and heart". 

 

Reviewing presidential office reports: 

Ms Choi allegedly reviewed reports from the Blue House that were up to 30cm thick almost every day. She used them in meetings with her own advisers to discuss policy issues and draft plans that went back to the Blue House. 

Shaping North Korea policy: 

Ms Choi allegedly predicted North Korea would collapse in two years, and Ms Park is rumoured to have implemented foreign policies based on this. A 2014 speech which set her vision for reunification was found in a discarded laptop belonging to Ms Choi. 

Masterminding cultural projects: 

Ms Choi was accused of being the mastermind behind many key projects by the Ministry of Culture, Sports and Tourism, mostly led by her film director friend Cha Eun Taek. Vice-Culture Minister Kim Chong, appointed in 2014, was also accused of collaborating with Ms Choi. 

Abusing presidential link to raise funds: 

Ms Choi was accused of abusing her friendship with the president to press conglomerates to donate to two non-profit groups she founded. The funds are suspected to have been diverted to finance her lifestyle and other schemes. 

 

Where could this scandal lead to?

Ms Park’s presidential powers have been suspended since Dec 9, when the National Assembly voted to impeach her. The  Constitutional Court has until June to decide whether her impeachment is justified, either reinstating her or formally ending her presidency.

In a hearing on Thursday (Dec 22), the court ordered the president to respond to one of the most contentious accusations against her: that she neglected her duties on the day in 2014 when hundreds died in the sinking of ferry Sewol.  

Why should the markets care?

South Korea, Asia's fourth-largest economy, already faces questions about its ability to maintain economic growth. Its shipbuilding and steel industries are faltering while electronic giants like Samsung Electronics face stiff competition from Chinese manufacturers. 

The political instability may add to what Bank of Korea Governor Lee Ju Yeol called uncertainties. It may also deepen worries about long-term growth prospects and the country's competitiveness.

Sources: The Straits Times Archives, AFP, Reuters, Bloomberg