The presidential office, Cheong Wa Dae, said Friday it was looking into an allegation that one of its presidential secretaries meddled in the selection of the head of South Korea's largest financial services group, KB.
Jung In-chul, secretary for planning and management at Cheong Wa Dae, also allegedly abused his power to affect the operation of the country's public firms and private banks.
A local newspaper reported that Jung had forced Lee Chul-hwi, chief of Korea Asset Management Corp., to drop his bid for the KB chairmanship last year.
It also said he convened a regular meeting of CEOs of major public corporations and large financial institutions. Jung said it was part of normal activities to collect opinions useful for state affairs.
Cheong Wa Dae maintained a cautious stance, saying a related investigation is underway.
"There is no problem in listening to various public opinions in the process of pushing for government policy," Cheong Wa Dae spokeswoman Kim Eun-hye told reporters. "But (we) are closely investigating whether the suspicions raised by the media are true and there was inappropriate behavior (by Jung)."
The main opposition Democratic Party (DP) claimed Jung misused his position to install members of an informal pro-government group into public organizations and other coveted posts.
The group, a coalition of about 200 civic groups nationwide, was formed to help Lee Myung-bak during his presidential campaign in 2007.
The network, dubbed "The Advanced People's Solidarity," once had more than 4.6 million members. Jung served as spokesman for the coalition.
With the election of Lee, a number of its members took high-level posts in the presidential office, the government and public firms.
The DP argues Jung and several other members of the group have systemically interfered with the personnel management of state-owned firms and even private companies