Luxury Watch Smuggling... Former CEO of HDC Shilla Duty Free Legally Detained

Rolex Watches Worth 172.57 Million KRW Purchased Under Foreign Nationals' Names and Exported to Hong Kong
Duty-Free Shop Employees Smuggled Watches into Korea
Former HDC Shilla Duty Free CEO, Later Shinsegae Executive

The former CEO of HDC Shilla Duty Free was sentenced to prison and taken into custody for smuggling high-priced duty-free goods, including Rolex watches, into the country using foreign nationals' names.

On the 11th, Shin Heung-ho, a judge of the Criminal Division 6 at Incheon District Court, announced that he sentenced former HDC Shilla Duty Free CEO Mr. A, who was indicted for violating the Customs Act, to 1 year and 6 months in prison and ordered his detention in court. Additionally, Mr. A was ordered to pay a fine of 172 million KRW.

The court also sentenced four former and current employees of HDC Shilla Duty Free and six officials from a special sales company based in Hong Kong who were indicted together with Mr. A. Two of them were each sentenced to 4 to 6 months in prison with a 1-year probation and ordered to pay fines ranging from approximately 110 million KRW to 153 million KRW. The remaining four were sentenced to fines of 1 million to 3 million KRW, 1-year probation, and fines ranging from approximately 19 million KRW to 120 million KRW. The HDC Shilla Duty Free corporation was fined 5 million KRW and ordered to pay a fine of approximately 19 million KRW.

Judge Shin explained the reason for the ruling, stating, "Despite being in a position to prevent duty-free smuggling, Mr. A mobilized employees to purchase high-end luxury goods on his behalf and caused criminal punishment for the trading companies and employees as well. The smuggling amount exceeded 170 million KRW, indicating a serious offense." He added that the sentencing for other defendants was determined considering their positions, involvement in the case, and whether they confessed.

Mr. A was indicted without detention on charges of smuggling four high-end luxury watches (worth approximately 172.57 million KRW) from Hong Kong into the country without declaring them to customs between April 28 and October 4, 2016.

Mr. A requested employees of the Hong Kong special sales company, which traded with HDC Shilla Duty Free, to purchase luxury watches at domestic duty-free shops using foreign nationals' names and export them to Hong Kong. Subsequently, former and current employees of HDC Shilla Duty Free, under Mr. A's instructions, smuggled the watches from Hong Kong into Korea. At that time, the duty-free purchase limit for domestic residents was 3,000 USD, while foreigners could purchase without any limit. Mr. A exploited this by purchasing a large number of luxury watches under foreign nationals' names and bringing them into the country.

Mr. A was the CEO of HDC Shilla Duty Free at the time of the crime but has since stepped down from the position. He later moved to Shinsegae Group, serving as CEO of Shinsegae International and head of the Shinsegae Future Innovation Promotion Team, before resigning in October 2023.