Former Daewoo Managing Staffs Concealed 10 Billion Won Property

It has been revealed that the former managing staffs of the Daewoo Group concealed the private properties of about 10 billion won, right before and after the 1999 walkout.

The Korea Deposit Insurance Corporation (KDIC) announced yesterday their first investigation report on the insolvent enterprises including Daewoo and Kohap, the companies that brought about the loss of public funds.

According to the investigation result, 8 former CEOs of the Daewoo subsidiary companies hurriedly sold or donated 21 real property items, total value of 9.958 billion won, to their family members right before or after the starting date of the walkout on the Daewoo Group, August 26th, 1999. A CEO concealed a real property item by falsely registering in cooperation with the bank employees. He also money-laundered through the bank employee.

In case of the Kohap, the company established the Uranus Co., a paper company, in Malaysia’s Labuan district, and let the paper company issue bonds and their Hongkong branch took over the bonds. With the illegally prepared fund brought into Korea through a form of foreign investment, Kohap illegitimately supported its subsidiary company by buying 1.99 million stocks of the Kohap Construction Co at 8,923 won, 80 percent more expensive price than normal price.

Director of the KDIC Kim Chun-Soo said, ``We already finished a legal garnishment measure for the concealed properties. And we will sue those who are responsible after we finish the on-spot investigations for Kohap by August, and Daewoo by the end of this year.``

sanjuck@donga.com