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“Explosive Scandal Unveiled: Shocking Revelations of Korean Society’s Covert Contributions to Lydia Ko’s Family”

"Explosive Allegations: Controversial Korean Society's Covert Cash Flow to Lydia Ko's Family Sparks Outrage!"

Society breached rules by hiding Korean bank donations to golfer’s family: officials
Donations of more than $100,000 from a Korean Government bank to golfing superstar Lydia Ko’s family were secretly filtered through an Auckland charity, breaching its own rules, says Internal Affairs.

 

 

Internal Affairs says it found the activities of the charity – the Korean Society of Auckland – could “constitute serious wrongdoing” and has issued a formal warning notice over the way it tried to disguise the donations in 2012 and 2013.

 

 

The saga arose after the Korean Development Bank (KDB) wanted to assist Ko but feared being criticised for supporting a non-Korean citizen, the Herald can reveal.

Following “private discussions” with Ko’s parents and the bank, Korean Society president Sung Hyuk Kim and past president Young Pyo Hong agreed to let the bank use the society’s bank account to transfer money to Ko’s parents.

 

 

“Due to their concerns both the KDB and Lydia Ko’s parents asked for the assistance of the society to facilitate the passing of money between them as they believed the society had the trust and confidence of the New Zealand and Korean public,” says the formal warning notice from Internal Affairs.

 

 

“These discussions established a way of transferring the funds from KDB to Lydia Ko’s parents without the payments becoming public knowledge.”

But Ko’s parents last night distanced themselves, saying they had no knowledge of, or influence over, the internal actions of the bank or charity.

 

 

Korea-born Ko, 17, was last month ranked the world’s No1 woman professional golfer, becoming the youngest player of either gender to attain the top-ranked position.

 

 

In the warning notice, dated March 3, Internal Affairs-Charities Services investigations manager Hammond Rees said the two Korean leaders “deliberately concealed” the real purpose of the money and allowed the society to be used as a cover.

 

 

“If questioned, the KDB would falsely claim that they had donated the money to the society for the benefit of the Korean people of Auckland,” Mr Rees wrote.

 

 

On September 25, 2012, fifty million Korean won ($53,931.35) was electronically deposited by the bank into the society’s Auckland bank account. The next day, $53,962.39 was withdrawn and electronically transferred to the personal bank account of Bangsuk Hyon, Ko’s mother.

 

 

A second transaction was made on March 28, 2013, when $53,787.94 was transferred from the bank to the society, and a few days later a cheque for the same amount was written for Ko’s mother and transferred into her account.

 

 

The cheque was authorised by Mr Hong and signed by Mr Kim.

The investigation also found that Mr Kim had used his position of influence to manipulate other financial transactions in an alleged attempt to obtain a personal profit, the warning notice states.

 

 

Mr Rees said the society’s activities were against its charitable purpose and in breach of society rules.

“The investigation has determined that these activities could constitute serious wrongdoing and could be grounds for removal from the Charities Register,” he wrote.

 

 

Investigators did not accept Mr Kim’s argument that assisting the bank’s funding for Ko was to create greater diversity in Auckland, and greater harmony between the Korean and New Zealand communities.

“The involvement of the society provided no benefit to the Korean community other than a potential sense of associated pride,” Mr Rees said.

 

 

Ko’s family said through a spokesman they had no influence over how the organisations were run.

“From our perspective and Ko’s understanding, this was a proper funding donated by KDB Foundation to Lydia’s parents through the Korean Society as part of KDB Foundation’s programme to support top global talents whose family were faced with financial difficulties as was the case with Lydia’s family,” said Ko’s agent, Michael Yim, in an email.

 

 

“How KDB or the Korean Society leaders chose to handle things internally within their organisations is unbeknownst to the Ko family and something which they have no influence over.”

Ethnic Communities Minister Peseta Sam Lotu-Iiga said he was disappointed the Korean Society’s reputation and future had been put in jeopardy.

 

 

“However I am pleased that the Department of Internal Affairs-Charities Services has taken firm action … this action should allay the fears of members that any similar activity could occur again.”

The department said the society would not be removed from the register as it would be “disproportionate” and “unfairly impact” its ongoing membership, function and reputation. Instead, it had given the society until March 31 to provide a “thorough and detailed written response” to address the issues raised.

 

 

Mr Kim said he accepted the findings. A meeting would be held this month to disclose details to members.

Q & A
What is it about?
Korean Society of Auckland leaders used the organisation to conceal financial support of over $108,000 from a Korean Government bank to Lydia Ko. The society’s president also allegedly made loans to the society for personal profit and there is civil court action against him.

 

 

Why is it wrong?
The society is a registered charity and an Internal Affairs-Charities Services investigation deemed these activities were against its charitable purpose and a rules breach.

 

 

What could happen?
The society could be struck from the Charities Register under the Charities Act 2005, but it was deemed that such formal action would be disproportionate and impact unfairly on its membership. It has been issued a formal warning.

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