Court: "Played a key role in leading the crime... Shows no attitude of remorse"
Kim Bong-hyun, the key figure in the ‘Lime redemption scandal,’ has been sentenced to 30 years in prison.
The Supreme Court’s First Division (Presiding Justice No Tae-ak) on the 28th upheld the original sentence of 30 years imprisonment against former chairman Kim, who was indicted on charges including violation of the Act on the Aggravated Punishment of Specific Economic Crimes (embezzlement).
Kim was prosecuted for embezzling 130 billion won from Star Mobility and Suwon Passenger, companies invested in by Lime Asset Management between 2018 and 2020, and for providing money and valuables to political circles.
The first trial sentenced Kim to 30 years in prison and ordered the confiscation of 76,935,400,000 won. The trial court stated, “Hyanggun Sangjohoe and Suwon Passenger faced a situation where operating funds were depleted, making it difficult to cover even routine expenses, and when adding the damages caused by fraudulent acts against Boram Sangjo Development and Tivoli C&C, the total damage amounts to approximately 125.8 billion won. Considering the circumstances, severe punishment for Kim is inevitable, and the sentence exceeds the recommended range of the sentencing guidelines.”
The second trial also sentenced him to 30 years, stating, “The total damage caused by the criminal acts amounts to about 125.8 billion won, and although the defendant played a leading and central role in the crimes, he only makes excuses and shows no remorse.” The Supreme Court agreed with the lower courts’ judgments.
Kim fled by cutting off his electronic ankle bracelet near Paldang Bridge in Hanam City, Gyeonggi Province, ahead of the first trial’s final hearing in November last year, but was apprehended 48 days later at an apartment in Hwaseong, Gyeonggi Province.
At the time in 2019, Lime was the top private equity fund asset management company in South Korea. Following the deregulation of private equity funds in 2015, it grew rapidly and managed nearly 6 trillion won in assets. Lime gained popularity with financial products that guaranteed annual returns of 5-8%.
However, to boost short-term returns, Lime purchased large amounts of ‘mezzanine funds’ from financially troubled companies listed on the KOSDAQ. Mezzanine is an Italian term meaning the intermediate floor between the first and second floors. Mezzanine funds are products designed to lower the risk of high-risk financial products by mixing them with low-risk products, resulting in a medium-risk product.
Ultimately, these funds failed, causing significant losses. According to an audit conducted by the Financial Supervisory Service in February 2020, Lime’s main fund was halved in value, and some of its sub-funds suffered total losses.
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