Suspended Sentence for Embezzling 48 Billion Won During Baekhyeon-dong Development
Jeong Baul, Chairman of Asia Developer, Found Guilty of Breach of Trust and Embezzlement
Court Recognizes Misappropriation of Company Funds and Preferential Treatment in Project
A private developer accused of embezzlement and breach of trust involving hundreds of billions of won during the Baekhyeon-dong development process was sentenced to a suspended prison term in the first trial.
On the 4th, the Criminal Division 27 of the Seoul Central District Court (Presiding Judge Woo In-seong) sentenced Jeong Ba-ul (69), chairman of Asia Developer, who was indicted for violating the Act on the Aggravated Punishment of Specific Economic Crimes, to two years in prison with a four-year suspension.
The court recognized Jeong's guilt for breach of trust related to Seongnam R&D PFV, the Baekhyeon-dong development project operator, embezzlement against Asia Developer, embezzlement against GSC Partners, and embezzlement against Younglim General Construction, but acquitted him of the remaining charges.
Earlier, at the sentencing hearing held in February, the prosecution demanded five years in prison and a fine of 200 million won, stating, "The Baekhyeon-dong development corruption case is a typical example of local entrenched corruption." The prosecution added, "Considering that the defendant obtained enormous development profits through preferential treatment from Seongnam City, embezzled large sums of related company funds to live a lavish lifestyle, and that the trust of Seongnam citizens was severely damaged during the development corruption process, this is a very serious matter."
In response, Jeong’s defense denied the charges of breach of trust and embezzlement. Jeong’s lawyer argued, "Since the parties properly executed the agreed sales costs according to the project's business feasibility table, breach of trust cannot be established."
The Baekhyeon-dong development project involved developing the area around the Korea Food Research Institute site in Baekhyeon-dong, Seongnam City, Gyeonggi Province, into apartments during the tenure of Lee Jae-myung, leader of the Democratic Party of Korea, as mayor of Seongnam. Jeong is the largest shareholder of Seongnam R&D PFV, the project operator of the Baekhyeon-dong development.
Jeong was indicted on charges of embezzling and breaching trust involving a total of 48 billion won from Seongnam R&D PFV, Asia Developer, and Younglim General Construction, which he effectively owns. It was revealed that during this process, about 5 billion won of company funds were diverted to a nonprofit organization chaired by his wife under the pretext of donations through inflated construction payments and false salary payments.
Meanwhile, Lee Jae-myung is separately on trial along with Jeong on charges including favoring Jeong with the Baekhyeon-dong development project and excluding Seongnam Urban Development Corporation, causing a loss of 20 billion won to the corporation.
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