Former Chairman Kim Accused of Embezzlement Heads to Trial in Custody
On the 6th, ahead of the prosecution review committee regarding the luxury handbag receipt case involving First Lady Kim Keon-hee, wife of President Yoon Seok-yeol, staff members are moving at the Supreme Prosecutors' Office in Seocho-gu, Seoul. Photo by Kang Jin-hyung aymsdream@
Former E Group (formerly Ewha Group) Chairman Kim Young-jun, who attempted to conceal and downplay the prosecution's investigation into embezzlement and breach of trust charges and falsely publicized lithium mine development projects to sell company shares at inflated prices, was indicted while in custody on the 13th. The prosecution believes Kim obtained approximately 240 billion KRW in illicit gains.
According to the legal community on the 13th, the Tax Crime Investigation Division of the Seoul Central District Prosecutors' Office (Chief Prosecutor Lee Jin-yong) formally indicted Kim Young-jun on charges of violating the Capital Markets Act and the Specific Economic Crimes Act (breach of trust) while in custody. Kim is accused of failing to fulfill disclosure obligations by reducing the reported scale of embezzlement and making false disclosures during the prosecution's investigation into embezzlement and breach of trust last year.
The prosecution states that although Kim provided collateral to affiliates and issued approximately 170 billion KRW worth of bonds with warrants through Meritz Securities, he falsely disclosed that the bonds were issued without collateral, misleading general investors. He is also accused of hiding the fact that he was under investigation for embezzlement and breach of trust, posting false information on the company website to prevent stock trading suspension and stock price decline, and distributing false positive press releases regarding lithium mine development to sell convertible bonds, thereby obtaining illicit gains amounting to approximately 240 billion KRW.
Following the revelation on the 19th of last month that the prosecution had requested arrest warrants for Kim and others, Ewha Electric issued a statement on its website clarifying that "the management mentioned in the reports are former executives who resigned last year and are unrelated to the current management, belonging to the former E Group."
Last November, the prosecution conducted raids on Ewha Group and Meritz Securities headquarters and summoned former Ewha Electric CEO Lee for questioning as a suspect in January.
The prosecution stated, "Considering that the defendant's actions caused significant economic damage to numerous small shareholders, that the damages to these shareholders have not been compensated, and that the defendant continues to live a luxurious lifestyle with high-end housing and designer clothing, strict punishment is necessary." The prosecution is continuing its investigation into three executives, including former General Manager Kim Sung-kyu, whose arrest warrant was dismissed, alongside former Chairman Kim.
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