Korean ferry owner’s son gets 3 years in jail

Korean ferry owner’s son gets 3 years in jail

The Incheon District Court on Thursday sentenced the late ferry owner Yoo Byung-eun's oldest son Yoo Dae-kyoon to three years in prison for pocketing some $1 billion (S$1.3 billion) in company funds.

Dae-kyoon, 44, was indicted on Aug. 12 on charges of embezzling company funds worth 7.39 billion won at seven units of Chonghaejin Marine Co., the operator of the Sewol ferry, between May 2002 and December 2013. Yoo Dae-kyoon (Yonhap)

The court also sentenced late ferry owner Yoo Byung-eun's close confidante Byun Ki-choon to four years in jail for incurring losses to Cheonghaejin Marine Co., the operator of the sunken Sewol, via embezzlement.

In its ruling, the court acknowledged the charges raised by the prosecution that Byun, as the chief of Cheonghaejin Marine's shipbuilding affiliate Chonhaiji, pocketed company funds.

In addition, the court handed down prison terms of several years or suspended terms for Yoo's other aides and younger brother.

His younger brother, Yoo Byung-ho, was sentenced to two years in prison for embezzlement. Along with some relatives and Kwon Yoon-ja, the widow of the elder Yoo, the 62-year-old brother was indicted for embezzlement of about a billion won from Chonghaejin Marine's sister firms or subsidiaries.

The younger brother is the father-in-law of singer-songwriter Park Jin-young, chief executive of JYP Entertainment.

Koh Chang-hwan, the former CEO of the now-defunct Semo Group (a former entity of Cheonghaejin Marine) was given a three-year jail term for similar charges. Oh Kyung-seok, chief of Hemato-Centric Life Foundation, a Cheonghaejin unit, was also sentenced to three years.

Five more aides and the late Yoo's older brother were given suspended prison terms from 18 months to 30 months, with probation terms of three years. They were Song Kook-bin, Park Seung-il, Lee Jae-young, Lee Kang-se, Kim Dong-hwan and Yoo Byung-il.

Investigators have looked into the allegation that Yoo and his close confidants stashed away assets of Semo Group after intentionally bringing the group to insolvency in 1997, and then buying back core subsidiaries including automobile and shipbuilding firms.

Ex-senior policymakers or lawmakers could also have been implicated in the group management's asset repurchasing process, according to prosecutors.

There are speculations that Semo Group had cozy relations with former President Chun Doo-hwan, who took power in a coup in 1979.

Yoo and his friendly powers have also been suspected of offering kickbacks to financial regulatory officials in exchange for financial firms' approval of huge loans.

The Financial Supervisory Service had said commercial banks and other secondary financial firms issued combined loans worth 400 billion won to Chonghaejin Marine Co., the operator of the ill-fated Sewol ferry, and dozens of its affiliates.

The prosecution also looked into the allegation that Yoo had sought influence in the process of revising the nation's shipping act.

Chonghaejin Marine Co. was established in 1999 to replace Semo Marine Co., the flagship unit of Semo.

In late August, a funeral ceremony was held for Yoo at Geumsuwon, the Salvation Sect's religious compound in Anseong, Gyeonggi Province, after he was found dead in a southern port city on June 12.

Yoo's burial has created difficulties in determining the cause of his death and retrieving the illicit wealth of his family and confidants. They are thought to be responsible for the sinking due to their alleged mismanagement of Chonghaejin Marine and lack of attention to vessel safety.

(kys@heraldcorp.com)

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