In another high-profile Korean corporate corruption case, a Seoul court handed down a four-year jail term to the former chief of SsangYong Group for illegally diverting funds to subsidies in the aftermath of the Asian financial crisis in the late 1990s.
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Kim Seok-won was convicted of breach of trust and embezzlement as the Seoul Western District Court found that he illegally diverted 120 billion won (US$115 million) to ailing affiliates and embezzled 700 million won, Yonhap reported.
“His crime caused huge losses to creditors, and the illegal diversion of funds, which significantly weakens transparency and financial health of group management, should be eradicated by all means for the country to move forward,” Judge Chang Jin-hoon said of reasons for reaching the verdict.
The judge did, however, acknowledge that Kim had not sought personal gains in the crime.
Following the verdict, Kim was immediately taken to jail. At the court, Kim called for leniency, saying the illegal funding was used to increase liquidity of the troubled SsangYong subsidies. Kim’s defence said he will appeal.
SsangYong Group, once one of the largest family-run conglomerates in Korea, was forced to sell many of its subsidiaries including the SsangYong Motor Company, which is now owned by China’s Shanghai Automotive Industry Corporation.
