President Duterte made the statement during a press conference in Davao City on Saturday night.
Philippine National Police (PNP) Chief Ronald "Bato" dela Rosa earlier revealed that a Korean mafia may have been involved in the killing of South Korean businessman Jee Ick-joo.
Duterte said, "I'm sure by this time that the NBI and the police… It's already out in the open. The cat is out of the bag so we now know the problem. But I've always heard from all intelligence sources that in Cebu, with due respect to the South Korean government... Sila ang humahawak ng droga, ng prostitution, ganoon [They have a hand in drugs, prostitution]."
Duterte stressed he is not condemning all South Koreans and said they are always welcome in the country.
Duterte "sorry" for Jee's death
President Rodrigo Duterte has apologized to Korean investors and Korean Ambassador to the Philippines Kim Jae-Shin for the kidnapping and killling of Korean businessman Jee Ick-joo.
At the ceremonial switch-on of Sarangani Energy Corporation, the President said he knows who the perpetrators are, promising "maximum punishment."
"I am very sorry for that sordid incident, but I can assure you, kayong mga pulis, 'di ko kayo palulusutin [you policemen, I will not let you get away]," Duterte said in a speech. "You will suffer."
After his apology, Duterte said if convicted, the suspects would get the death penalty if it were still allowed.
Dela Rosa said the evidence against a cop tagged in Jee's killing was strong
"Very overwhelming po ang evidence sa kanya [The evidence against him is overwhelming]," Dela Rosa said on January 26, during the Senate probe on kidnap-for-ransom incidents allegedly committed by the police.
Dela Rosa was overwhelmed with shame when he found out an abducted Korean businessman was killed right inside police headquarters.
"Kung pwede lang matunaw ako sa kinalalagyan ko sa hiya."