Allegations of Unfair Support, Embezzlement, and Breach of Trust by Affiliate... Prosecution Seeks 12-Year Prison Sentence for Chairman Cho Hyun-beom

Sentencing Scheduled for May 29
Cho Hyun-beom Says, "It Is My Fault... I Will Strive to Become a Transparent Company"

The prosecution has requested a 12-year prison sentence for Cho Hyun-beom, chairman of Hankook & Company, who is on trial for embezzlement and breach of trust involving approximately 20 billion won.

According to the legal community on the 4th, the prosecution demanded a 12-year prison term and a fine of about 78.96 million won at the sentencing hearing for Chairman Cho held on April 27 at the Seoul Central District Court Criminal Division 23 (Presiding Judge Oh Se-yong).

The prosecution also requested two-year prison sentences for executive Mr. Jung and manager Mr. Park of Hankook Tire & Technology (Hankook Tire), who were indicted alongside Chairman Cho. In addition, under the corporate liability provision, the prosecution sought a 200 million won fine against the Hankook Tire corporation.

In his final statement, Chairman Cho reportedly said, "Everything is my fault, and I deeply reflect on it," adding, "I will strive to become a transparent global company." The sentencing hearing is scheduled for May 29 at 2 p.m.

Chairman Cho was indicted in March 2023 on charges of providing unfair support by paying higher prices than other manufacturers in the process of Hankook Tire receiving tire molds from its affiliate, Hankook Precision Works (MKT), from February 2014 to December 2017.

The prosecution stated that the estimated loss Hankook Tire suffered in this process amounts to 13.1 billion won. The profits accumulated in MKT were believed by the prosecution to have flowed into the hands of Chairman Cho and his family. MKT is majority-owned by Chairman Cho’s family.

Meanwhile, Chairman Cho is also accused of embezzling approximately 7.55 billion won of company funds and causing damage to the company from 2017 to 2022. The prosecution believes that he lent 5 billion won of MKT funds to Hyundai Motor’s partner company Rihan without special collateral by leveraging his personal relationship with the CEO, and also spent company money on furniture purchases for his private residence.