Lee faces bribery, breach of duty, conflict of interest and other charges in relation to large-scale development projects in Daejang-dong and Wirye, Seongnam City, just south of Seoul. The two projects were carried out while Lee was serving as the Seongnam mayor between July 2010 and March 2018.
It is the first time in South Korea that the prosecution has requested an arrest warrant for the chief of the country's largest opposition party.
Lee is suspected of causing 489.5 billion won ($381.6 million) of financial damage to the municipal government by allowing private partners to pocket excess profits from the Daejang-dong project.
The prosecution accused Lee of approving the removal of a profit-sharing arrangement for the project which made the city receive only 183 billion won of profit from the private-public development project, causing a huge loss to the city.
The law enforcement agency presumed that if Lee had executed the project properly, Seongnam City could have secured a far higher profit of 672.5 billion won, or 70 percent of the entire profit arising from the lucrative project.
Lee is also suspected of letting his confidants leak confidential information about the project to private partners, helping the businesses garner an excessively high profit of 788.6 billion won.
In addition, Lee was charged with leaking the city's inside information to Hoban Construction in a bid to unfairly help the builder win a deal with the municipal authorities for the Wirye development project. As a result, Hoban and other private partners managed to make an illicit profit of 21.1 billion won, according to the prosecution.
Besides, he faces allegations that he attracted 13.3 billion won in corporate donations to the football club Seongnam FC from four companies, including Doosan Engineering & Construction and internet portal Naver, in return for business favors. The former mayor was the head of the club.
Lee, former presidential candidate of the DP, has denied all the allegations, criticizing the prosecution for conducting politically-motivated investigations to suppress the opposition party and its leader under the rule of conservative President Yoon Suk-yeol. His party has denounced the investigation as political revenge.
The prosecution's move came after investigators summoned Lee for questioning three times in January and February to get to the bottom of the corruption case. It is expected to deepen political conflicts between the progressive opposition and the conservative ruling People Power Party (PPP).
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