Prosecutors Indict Daebang Construction CEO for Profitable Public Land Resale to Family Affiliates

Prime Public Land in Magok and Dongtan Funneled to Affiliates
Indicted Without Detention for Violating the Fair Trade Act

The CEO of Daebang Construction has been brought to trial on charges of providing economic benefits worth several hundred billion won by funneling prime public land worth about 200 billion won to family affiliates.

The Fair Trade Investigation Division of the Seoul Central District Prosecutors' Office (Chief Kim Yong-sik) indicted Daebang Construction Corporation and CEO Koo Chan-woo without detention on charges of violating the Fair Trade Act on the 21st.

CEO Koo and others are accused of unfairly supporting by reselling public land won by Daebang Construction to affiliates such as Daebang Business Development, operated by Koo Kyo-woon, the chairman and father-in-law. CEO Koo is the son of Chairman Koo.

The public land resold by Daebang Construction to Daebang Industrial Development, operated by the chairman's son-in-law, includes prime locations such as Magok in Gangseo-gu, Seoul, and Dongtan in Hwaseong, Gyeonggi Province, areas rich in development prospects. Daebang Construction secured these sites using a so-called 'swarm bidding' method, mobilizing multiple affiliates to increase the chances of winning the bids.

Daebang Industrial Development not only developed these lands to achieve sales of 1.6 trillion won and operating profit of 250.1 billion won but also improved its construction capability evaluation ranking from 228th in 2014 to 77th last year. It was found that most of the shares of Daebang Industrial Development are owned by the chairman's daughter and daughter-in-law, but the actual operation was conducted by the son-in-law.

Previously, the Fair Trade Commission imposed a fine of 20.5 billion won and referred the case to the prosecution, stating that Daebang Construction secured six public land sites worth about 206.9 billion won over approximately five years from November 2014 to March 2020 and then resold them to affiliates. Following the FTC's complaint, the prosecution launched an investigation and continued it by conducting a search and seizure of affiliate offices on the 7th.