Police Conduct Third Search Related to Embezzlement and Breach of Trust Allegations Against Former Taekwang Chairman Lee Hojin

Former Taekwang Group Chairman Lee Hojin is under investigation as the police conducted a third search and seizure related to allegations of embezzling several billion won in slush funds and improperly paying construction costs to affiliated companies.

On the 1st, the Anti-Corruption and Public Crime Investigation Unit of the Seoul Metropolitan Police Agency announced that they were conducting search and seizure operations at the finance office of Taekwang Industrial in Jung-gu, Seoul, as well as at the homes of Group Finance Director A and HR Director B.

This is the third police search related to allegations against former Chairman Lee. On October 24, the police searched Lee’s residence, the Taekwang Group Future Management Council office, and Taekwang Country Club (Taekwang CC). Subsequently, on the 20th of last month, they searched the Taekwang Golf Practice Range in Yongin, Gyeonggi Province, and the office of Tisis in Jung-gu, Seoul.

Former Chairman Lee is accused of embezzlement and breach of trust by mobilizing group affiliates to create slush funds amounting to several billion won and improperly paying construction costs to affiliates through Taekwang CC. The police believe Lee diverted funds by paying false salaries through employees’ accounts. Although holding concurrent positions as an executive in affiliated companies is prohibited, he violated this rule by being registered at two companies and receiving double salaries. Additionally, he is suspected of having Taekwang CC cover 860 million won in construction costs for the golf practice range and using 80 million won from affiliate corporate credit cards for personal purposes.

The Taekwang Group explained that the corrupt acts were committed by the management team that ran the group during Lee’s absence. Lee was indicted in 2011 on charges of embezzlement and breach of trust of company funds, sentenced to three years in prison by the Supreme Court in June 2019, and was released in October 2021 after serving his term. He was reinstated through a special pardon on Liberation Day in August.