Embezzlement, False Capital Contribution, and Forgery of Electronic Records under the Special Act
Sentence Increased to 43 Years Imprisonment
Kim Jae-hyun, former CEO of Optimus Asset Management, who is serving a 40-year prison sentence for a large-scale fund fraud, has been additionally sentenced to 3 years in prison by the Supreme Court on separate embezzlement charges.
According to the legal community on the 10th, the Supreme Court's First Division (Presiding Justice No Tae-ak) upheld the original sentence of 3 years imprisonment in the appeal trial of former CEO Kim, who was indicted on charges of embezzlement under the Act on the Aggravated Punishment of Specific Economic Crimes, violation of the Commercial Act (fictitious payment of capital), false entry in electronic records, and use of false electronic records.
The court stated, "Upon reviewing the reasons for the original judgment based on relevant laws and properly admitted evidence, there is no error in the original court's judgment that violates the rules of logic and experience, exceeds the limits of free evaluation of evidence, or misinterprets the principles regarding the indictment's specificity, intent and conspiracy in fictitious payment and embezzlement, or the legal principles concerning another person's property and unlawful gain in embezzlement," thus dismissing the appeal.
Former CEO Kim is accused of withdrawing 5 billion KRW of paid-in capital deposited by Hwaseong Industrial, the largest shareholder of affiliated company Haeduck Powerway, in May 2020, and arbitrarily using it for the redemption of the Optimus fund, as well as making a fictitious payment of the 5 billion KRW paid-in capital.
He is also accused of using 13.3 billion KRW of Haeduck Powerway's loan funds for the redemption of the Optimus fund, and misappropriating 2.9 billion KRW of funds from Daehan Systems, acquired with Optimus funds, for fund refunds and other purposes.
The first trial court found all charges against former CEO Kim to be true and sentenced him to 5 years in prison.
The second trial court also found the charges against former CEO Kim, which were judged guilty in the first trial, to be true. However, on July 14, 2022, the Supreme Court overturned the first trial judgment and reduced the sentence to 3 years, citing fairness with the case in which Kim’s 40-year sentence for fraud under the Act on the Aggravated Punishment of Specific Economic Crimes was confirmed, and changes in the prosecutor’s indictment.
The prosecution argued that the money embezzled by former CEO Kim should be confiscated, but this was not accepted. According to the Act on the Confiscation of Corrupt Property, confiscation is only possible in cases where the victim cannot exercise the right to claim damages and 'recovery of damages is extremely difficult,' but this case did not meet those conditions.
Former CEO Kim appealed the second trial verdict, but the Supreme Court found no problem with the second trial’s judgment.
From April 2018 to June 2020, former CEO Kim raised about 1.3 trillion KRW by claiming to invest in public institution accounts receivable, and was sentenced to 40 years in prison, a fine of 50 million KRW, and confiscation of 75.175 billion KRW for using the funds for acquiring non-performing loans and rolling over funds, and is currently serving his sentence.
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