Former chairman of Haitai Group apprehended

Lee Seung-Koo of the Seoul district prosecutor¡¯s office and his team apprehended the former chairman of Haitai Group, Park Kun-Bae, for malfeasance.

According to the persecutor¡¯s office, after the Group declared bankruptcy in November 1997, the former chairman misappropriated 1.9 billion won for personal use while selling the group¡¯s training institute in Gwangju, Gyeonggi to Hyundai Marine & Fire Insurance for 19 billion won. The chairman drafted fraudulent contracts to make it appear that furnishings from the Institute were sold for 100 million won to a furniture company known as Han¡¯s Tech while he actually sold the furnishings to Hyundai for 2 billion won, making a hefty profit of 1.9 billion won. He used the money for personal purposes instead of for repaying debts to creditors.

Moreover, the former chairman is charged with taking bribes worth 100 million won from the president of Hap Kyung, a camouflage company in which he holds a majority share, for the exclusive distribution of goods for Haitai Confectionery. An investigation revealed that the former chairman instructed the president of Hap Kyung to use company money to purchase his personal car for 48 Million won in March 1994. Moreover, the former chairman is known to have embezzled 2.5 million won a month, or a total of 187.5 Million won from April 1994 to June, for maintenance on his car.

The prosecutor¡¯s office has also arrested Han Sang-Chan, president of Han¡¯s Tech, on charges of taking money for drafting dual contracts in regards to the sale of Haitai Training Institute, and thereby creating illegal funds for the former chairman of Haitai Group.

Shin Suk-Ho kyle@donga.com