Former VIK CEO Lee Cheol acquitted in first trial on 40 billion won embezzlement charges in 'Channel A Incident'

Lee Cheol, former CEO of Value Invest Korea (VIK), who appeared in the 'Channel A Coercion Attempt' allegations, was acquitted in the first trial on charges of breach of trust involving approximately 40 billion won.

The Criminal Division 13 of the Seoul Southern District Court (Presiding Judge Kim Sang-yeon) on the 21st acquitted Lee, who was charged with causing damage to the company by lending 41.15 billion won collected through corporate investment bait to CEO Ahn of Company Y 31 times from May 2014 to July 2015 without collateral (breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes).

Seoul Nambu District Court.

The court found it difficult to conclude that Lee had the intent to benefit CEO Ahn at the expense of VIK's losses.

The court explained, "The defendant did not have any special private relationship with CEO Ahn, nor is there any evidence that he separately pocketed or recovered part of the loan," adding, "It appears that the victim company was also involved in the use of the loan and took measures to ensure the funds were not used for purposes other than the company acquisition."

The court also stated, "CEO Ahn transferred a significant number of Company Y shares to VIK as collateral or repayment for the loan," and "At that time, Company Y shares were valued at about 20,000 won per share, so the repayment amount could be considered to exceed the loan amount."

Lee operated VIK from 2011 to 2016 and was sentenced to a total of 14 years and 6 months in prison in August 2021 for violating the Capital Markets Act and fraud by raising 700 billion won from about 30,000 people through a multi-level marketing scheme without financial regulatory approval. He is currently serving his sentence.

Lee is a figure involved in the so-called 'media collusion' case with former Channel A reporter Lee Dong-jae.

Former reporter Lee was investigated on charges of attempted coercion for conspiring with Han Dong-hoon, former emergency committee chairman of the People Power Party (then prosecutor general), to coerce Lee Cheol by threatening severe punishment if he did not disclose corrupt information about former Roh Moo-hyun Foundation chairman Yoo Si-min.

Former reporter Lee was acquitted earlier this year, and former chairman Han was cleared of charges in April 2022.