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South Korean prosecutors expanded an investigation into the country's largest multi-level marketing company, examining allegations that it bribed politicians and government officials, including the family of a presidential secretary, to help curtail a probe into its fraudulent sales activities.

The Seoul Eastern District Prosecutors' Office said Tuesday it will increase the number of prosecutors investigating the case to seven from the current four and try to uncover all suspicions surrounding the JU Group.

"We will shift the focus of our investigation to the lobbying suspicions from now on," a prosecution official told reporters on condition of anonymity.

Prosecutor-general Choung Sang-myoung also vowed to thoroughly investigate the case "that could be remembered as the nation's biggest-ever fraud involving some 340,000 people whose combined losses are expected to reach 4 trillion won."

Since opening the probe in March, a local prosecutor in Seoul has been investigating whether Joo Soo-do, jailed chairman of the JU Group, illegally raked in huge profits after luring the group's employees with unfulfilled promises of high returns for their sales activities.

Joo was arrested in July on fraud, embezzlement and breach of trust charges. Last week the probe was expanded to examine a report by the National Intelligence Service that Joo created over 200 billion won (US$214 million) in slush funds and used 10 billion won for bribing ranking government officials, politicians and newspaper editors, between 2002 and 2005.

Prosecutors recently confirmed the report, saying at least 100 names, far more than initially known, were on the group's lobbying list and 10 of them were public officials. Investigators are now trying to determine whether the public officials accepted the gifts in return for offering government favors.

Prosecutors also said the family of Lee Jae-sun, a secretary to President Roh Moo-hyun, allegedly received preferentially high returns for their investment in the group and that they would soon summon four of his family members.

Unlike the group's ordinary members, who received almost nothing for their investment, Lee's family members were allegedly paid a total of 1 billion won in return for their purchase of company goods worth 1.2 billion won, the prosecution officials said. Lee offered to resign after the suspicion was officially raised.

The firm's chief computer engineer, identified only as Hong, is wanted by prosecutors on charges of frequently manipulating computer data on payments for the firm's investors.

Hong was instructed by his boss to set up five different criteria for payments based on the clerks' social positions, according to prosecution sources.

Prosecutors also arrested a police superintendent on charges of taking 50 million won from JU in August 2004 in return for pledges to help it escape the police investigation into its irregular sales activities.

Established in 1999, the JU Group posted about 2 trillion won in sales in 2004, becoming the nation's No. 1 pyramid-style marketing company, with Amway Korea in second place.

Seoul, Nov. 28 (Yonhap News)