First lady Kim Keon Hee speaks during a meeting with North Korean defectors and human rights activists at the National Endowment for Democracy in Washington, July 11 (local time). Joint Press Corps

First lady Kim Keon Hee was interrogated by prosecutors over allegations that she illegally accepted a luxury handbag from a Korean American pastor and was involved in a stock manipulation scheme, according to the Seoul Central District Prosecutors' Office, Sunday,

Kim was summoned on Saturday for an investigation into graft and stock manipulation cases. She was questioned face-to-face at an undisclosed government building for about 12 hours.

Kim faces allegations that she illegally accepted a Christian Dior handbag valued at around 3 million won ($2,158) from pastor Choi Jae-young during their meeting in Seoul in September 2022, four months after President Yoon Suk Yeol's inauguration.

Choi conspired with YouTube-based media outlet Voice of Seoul to secretly film his meeting with Kim. The media outlet released the footage last November and filed a complaint with the prosecution against Kim and Yoon for bribe acceptance and violating the anti-graft law.

Earlier this month, Kim's aide told prosecutors that the first lady ordered the return of the bag on the same day she received it. However, the bag was ultimately not returned but instead has been kept at the presidential office.

Kim was also grilled over her involvement in the stock manipulation of Deutsch Motors, a BMW car dealer in Korea, between 2009 and 2012.

"Kim faithfully cooperated with the investigation and discussed everything truthfully," Kim's lawyer Choi Ji-woo said. The presidential office said it was inappropriate for it to address the prosecution's investigation of the first lady.

The feud between the Supreme Prosecutors' Office and Seoul Central District Prosecutors' Office is heating up after local media reported that the top prosecutor wasn't briefed about the interrogation in advance.

"Neither Prosecutor General Lee (One-seok) nor any of the supreme prosecutors knew about the questioning. The Seoul Central District Prosecutors' Office informed us when the questioning was nearing an end. Lee is deeply concerned about this situation," an official from the Supreme Prosecutors' Office said.

The first lady's scandal has been a bone of political contention for more than half a year and was one of the factors in the ruling bloc's crushing defeat in the April 10 general elections.

Prosecutors sent a written questionnaire to Kim in 2021 and 2023, but didn't receive the necessary responses. The investigation began to speed up after Prosecutor General Lee ordered the Seoul Central District Prosecutors' Office to set up a team dedicated to investigating the allegations against Kim in May.

A flag with the logo of the Seoul Central District Prosecutors' Office flutters in front of its building in Seoul, Sunday. Yonhap

The case is a serious blow to Yoon, whose grip of state affairs weakened following the election outcome in April. During a press conference to commemorate the second anniversary of his presidency in May, Yoon apologized for his wife's acceptance of the bag.

The questioning comes as the opposition-controlled National Assembly's Legislation and Judiciary Committee designated Kim as a witness for a public hearing on July 26 on an impeachment petition against her husband, during which she will be questioned on the charges against herself. The opposition, which has been calling for a special counsel to investigate the first lady, slammed the prosecution's move to question Kim behind closed doors.

"Prosecutors have not summoned Kim for many years. But they suddenly questioned her after the Legislation and Judiciary Committee requested her to appear as a witness for a hearing on July 26 on a petition demanding the impeachment of President Yoon. Does Kim stand above the law?" Rep. Kang Yu-jung of the main opposition Democratic Party of Korea (DPK) said in a statement.

"People know that the prosecution is putting on a political show to clear Kim of the charges," Kim Bo-hyup, the chief spokesperson of the Rebuilding Korea Party, said in a statement.

On the other hand, the ruling People Power Party (PPP) argued that the investigation was conducted strictly in accordance with the law and principles. "It's regrettable that the DPK is trying to abuse the case and turn it into a political dispute. We have clearly stated that the Assembly hearing is unconstitutional and illegal," Rep. Cho Ji-yeon of the PPP said in a statement.