Prosecution Investigates Former Taekwang Chairman Lee Hojin for 'Forced Sales of Kimchi and Wine'

[Asia Economy Reporter Bae Kyunghwan] The prosecution is reportedly reviewing whether to file additional charges against former Taekwang Group Chairman Lee Hojin, who is currently serving time for embezzlement involving hundreds of billions of won. The charges relate to forcibly selling kimchi and wine produced by companies owned by the family of the group’s head to affiliated companies.

According to the legal community on the 6th, the Fair Trade Investigation Division of the Seoul Central District Prosecutors' Office (Chief Prosecutor Ko Jinwon) investigated former Chairman Lee in April and recently questioned former Taekwang Group Management Planning Office Director Kim Giyu as a suspect.

In 2019, the Fair Trade Commission uncovered that 19 Taekwang Group affiliates had unfairly purchased kimchi and wine from 'Tisis' and 'Merbang,' companies wholly owned by the family of the group’s head. The FTC reported former Chairman Lee, former Director Kim, and the affiliates to the prosecution and imposed a fine of 2.18 billion won.

The investigation revealed that former Director Kim set the price of kimchi at two to three times the market price and allocated purchase quantities to each affiliate, instructing them to buy accordingly. After about two years of investigation following the FTC’s report, the prosecution is expected to soon decide whether to indict former Chairman Lee and former Director Kim.

Meanwhile, former Chairman Lee is currently serving a three-year prison sentence confirmed by the Supreme Court in 2019 for embezzlement and breach of trust involving approximately 40 billion won of company funds. He is scheduled to be released in October, but if the prosecution files additional charges, he will have to face trial again.