[Asia Economy Reporter Kim Daehyun] At the first trial, Choi Seon-won, chairman of SK Networks, who is accused of embezzlement and breach of trust involving approximately 220 billion won, criticized the prosecution's indictment, saying, "All of these are outdated, and some have no damage at all or the damage has never materialized, yet they have been packaged as if they were serious conglomerate crimes."
At the first formal trial of Chairman Choi held on the 22nd under the jurisdiction of the 23rd Criminal Division of the Seoul Central District Court (Presiding Judge Yoo Young-geun), the defense attorney stated, "In 2017, the Financial Intelligence Unit (FIU) detected suspicious fund flows and handed over the case, which the prosecution thoroughly investigated, but no evidence of overseas slush fund creation was found, confirming the case to be groundless," adding, "The prosecution conducted a dragnet investigation by seizing SK affiliates and summoning over 120 related persons based on some facts revealed during account tracing."
Earlier, the prosecution had arrested and indicted Chairman Choi on charges of embezzling and breaching trust of 223.5 billion won from six companies he operated, including SK Networks, SKC, and SK Telesys, under the pretexts of pursuing a personal golf course business, paying false salaries to family members, paying for personal capital increases, and supporting insolvent affiliates.
On this day, the defense denied most of the seven charges revealed through the full statement by the prosecution. However, they partially admitted to the charges of violating the Act on Real Name Financial Transactions and Confidentiality by exchanging approximately 1.6 billion won in 158 cases under an employee's name to evade reporting regulations in December 2017, and violating the Foreign Exchange Transactions Act by carrying about 900 million won in foreign currency abroad without reporting on 17 occasions from February 2016 to January 2018.
At the previous pretrial hearing, the court decided to prioritize the trial of the charges of breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes for lending 15.5 billion won without collateral from SK Telesys funds to his personal company A, which was developing a personal golf course project in 2009, and embezzlement under the same Act for withdrawing 16.4 billion won from SK Telesys funds without accounting and using it for his personal capital increase in 2012. Accordingly, witness examinations of three related persons, including former SK Telesys CEO Park, were conducted on this day.
First, the defense argued, "We admit to using SK Telesys funds but returned them immediately," and "There was no actual damage to SK Telesys." They further denied any illegal intent related to embezzlement, stating, "The full repayment was made within the same fiscal year, 2012."
They also rebutted, "At the time of the second capital increase, Chairman Choi, the second-largest shareholder of SK Telesys, was reluctant to participate due to a lack of personal funds, but the SKC board declared that the defendant should show responsibility for the failure of the mobile phone business, so he reluctantly participated," adding, "This was merely a passive compliance with the board's demand for sacrifice, which is contrary to the prosecution's allegations."
The witnesses who appeared on this day unanimously stated that they did not know the specific circumstances or reasons regarding SK Telesys's unsecured loan of 15.5 billion won to Company A. However, fund team employee B testified that '(under the instructions of superiors) SK Telesys company funds were withdrawn and deposited into Chairman Choi's personal account, and it was processed as if Chairman Choi had properly paid.'
The court set the next trial date for the 29th and decided to summon three SK Telesys officials, including Lee, for witness examination.
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