(Seoul = Yonhap News) Reporter Lee Young-seop = Former Taekwang Group Chairman Lee Ho-jin, who was indicted on charges of embezzling billions of won in company money, denied the charges again at the first formal trial.
On the other hand, former Taekwang Group Management Council Chairman Kim Ki-yu, an accomplice and the person who reported former Chairman Lee's misconduct to the police, made a statement consistent with the alleged facts.
Chairman Lee's lawyers announced on the 9th that they would deny all of the charges in the first trial on charges of embezzlement and breach of trust under the Specific Economic Crimes Act, held at the Seoul Central District Court's Criminal Agreement Division 24 (Chief Judge Lee Young-sun).
He also said that some charges should be dismissed. Dismissal of an indictment is a procedure to close a lawsuit without determining the substance of the case when the indictment procedure violates the law.
Former Chairman Kim Ki-yu, who was also indicted, requested dismissal of some charges and announced that he would confess to the remaining charges.
On this day, former Chairman Kim was interrogated as a witness regarding the charges against former Chairman Kim and made several unfavorable statements against former Chairman Kim.
He claimed that even after former Chairman Lee Ho-jin was arrested and indicted in 2011 on charges of tax evasion and resigned from his position as chairman, he substantially intervened in the management of the group through his relatives.
It was said that after former Chairman Lee was re-arrested due to bail cancellation in 2018, he submitted reports related to important work every week through his lawyer until he was released from prison at the end of his term in October 2021.
At this time, it was added that former Chairman Lee wrote a handwritten memo on work-related issues and handed it over to his lawyer.
When the prosecution asked, "Ultimately, did the defendant Ho-jin Lee receive reports on and manage the group's personnel and performance and other operational status even after he resigned from his position as CEO?" former Chairman Kim responded, "I think he did so with regard to important matters."
Former Chairman Lee Ho-jin also released a statement that fits the core allegations that he paid Taekwang for the construction costs of a privately owned golf driving range, registered his relatives as executives and employees of the company, and paid them salaries even though they did not actually work.
Regarding the provision of salary to relatives, he testified, "I suggested to the chairman (former chairman Lee) that it could be a problem in a tax investigation, but I could not refuse because he said, 'I am a person related to the majority shareholder, so I would like him to just receive it.'"
The prosecution asked, "I suggested Lee Ho-jin stop it, but did he say, 'Just leave it alone because my nephews have to make a living too?'" and former Chairman Kim said, "Yes."
Former Chairman Kim also claimed that he provided 30 million won in slush funds every month by returning the salaries of himself and his trusted employees to the company and paying them to former Chairman Lee.
Former Chairman Lee Ho-jin's lawyers, who cross-examined him, delved into the credibility of former Chairman Kim's statement.
The defense team pointed out that the time and place where former Chairman Kim reported to former Chairman Lee regarding the construction of the golf driving range was unclear.
When the defense team pointed out, "The witness stated during the prosecution's investigation in April of this year that 'the timing of the report was all guesswork and honestly he did not remember the location,'" former Chairman Kim claimed, "I made a false statement by mistake."
Regarding the method by which former Chairman Lee raised the slush fund, former Chairman Kim's statement changed and pressed, "Did he make a false statement?" Former Chairman Kim protested, saying, “It is not false, but a mistake.”
Former Chairman Lee was indicted without detention in May of this year on charges of raising 3.1 billion won in slush funds between 2008 and 2023 by falsely preparing ledgers as if the group's executives were working for affiliates, paying salaries and then receiving them back.
He was also charged with having Taekwang CC, owned by Taekwang Group, pay for the construction costs of a golf driving range that Chairman Lee personally owned, and using approximately 80 million won from a corporate credit card for personal use.
Taekwang's side has stated that the incident began when former Chairman Kim gave a false report to the police in order to pass the blame on to former Chairman Lee.
