PPP faces W39.7b repayment bill if Yoon conviction stands

With former President Yoon Suk Yeol handed a suspended sentence at trial — a ruling that voids his election win under the Public Official Election Act — attention is turning to the repayment process for the 39.7 billion won ($27.1 million) in election expenses that the People Power Party would have to return to the National Election Commission if the Supreme Court upholds the conviction.

The Seoul Central District Court's Criminal Division 21, presided over by Judge Jo Sun-pyo, sentenced Yoon on Monday to one year and six months in prison, suspended for three years, on charges of violating the Public Official Election Act.

Under the act, when an election-related conviction carrying a fine of 1 million won or more is finalized, the convicted party must return any election expenses reimbursed by the National Election Commission. In presidential elections, however, the obligation falls not on the candidate but on the nominating party.

The People Power Party received a total of 39.7 billion won in reimbursements during the 20th presidential election — 39.4 billion won in campaign expenses and 300 million won in deposit. Should Yoon's conviction be finalized by the Supreme Court, the party would be required to return the full amount to the commission.

After receiving the court's written ruling, the commission issues a first repayment order demanding the funds be returned within 30 days. If the party has not paid with 10 days remaining, a second repayment order follows.

If the party still fails to comply after the second order, the commission refers the case to the relevant tax office for collection, and the National Tax Service then pursues the amount through its tax delinquency procedures.

Given the composition of the People Power Party's assets, raising the funds is likely to take time. As of February, the party's total assets stood at about 131.5 billion won, but the bulk consists of real estate holdings such as land, buildings and lease deposits; cash and deposit-type assets amount to only about 11.6 billion won — less than the 39.7 billion won subject to repayment.

Even when the Supreme Court issues a final ruling, cases of parties failing to return election expenses are not uncommon.

According to data the National Election Commission submitted to the office of Democratic Party of Korea lawmaker Chae Hyeon-il, the total amount of unreturned election expenses as of Jan. 31 stood at 23.6 billion won.

Of that, 11.29 billion won — accounting for 47.7 percent of the total — had been outstanding for more than 10 years since the repayment order was issued. An additional 3.57 billion won has in effect become unrecoverable because the five-year statute of limitations under current law has expired.

To address these problems, the commission has proposed to the National Assembly measures including deferring reimbursement of election expenses for candidates indicted or reported for election crimes until their convictions are finalized. Bills to extend the statute of limitations on repayment claims or bar candidates who have not returned election funds from registering have also been introduced, but none has passed the Assembly.

"There are cases where the National Tax Service notifies us that collection is impossible because there are no assets to seize," a commission official said. "But since political parties hold real estate and other assets, we believe we will be able to recover the election expenses."