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Hyundai Electronics Is To Be Charged with Money Transfer

Hyundai Electronics Is To Be Charged with Money Transfer

Posted February. 04, 2003 22:44,   


Minority shareholders of Hynix Semiconductor Inc. have decided to charge the then Hyundai Electronics management with the alleged money transfer of 100 million dollars to North Korea.

With regard to this, Hyundai Engineering and Construction Co. Ltd claimed that it did not borrow 100 million dollars from Hyundai Electronics, developing the case into a row between the old Hyundai subsidiaries. The truth of the disappeared money seems to depend on the result of the argument.

The citizens` association for reviving Hynix, a gathering of the Hynix minority shareholders, made it clear on Feb. 4 that it would charge the Hyundai Electronics management with their operational misfeasance as of May in 2000 and also file a civil suit of shareholders.

The then CEO of Hyundai Electronics was Chairman Chung Mong-hun of Hyundai Asan and the president of the company was Park Jong-sub who is staying in the United States at the moment.

Oh Pil-geun, chairman of the association said, “The management must be held responsible for making the company with the debt of 1.3 trillion won more insolvent and inflicting a loss on the shareholders. As soon as finishing the review of the legal proceedings, we are planning to finish filing complaints before the shareholders meeting on Feb. 25.”

In response to this, Hynix Semiconductor Inc. said, “The whereabouts of the money should be come into light by Hyundai Engineering and Construction Co. Ltd. We will request the company to repay the money. If they refuse, we will file a claim for it.”

However, Shim Hyun-young, President of Hyundai Engineering and Construction Co. Ltd, argued that Hyundai Al Khafajy Co. (HAKC), the ghost company of Hyundai Engineering and Construction Co. Ltd, has never received 100 million dollars from Hyundai Electronics. The company claims that it transferred 100 million dollars of proceeds from sale of its factory in Scotland, but there was no such deal.”

If Shim`s claim is true, Hyundai Electronics might have stashed away the money, taking advantage of Hyundai Engineering and Construction Co. Ltd`s paper company without the company knowing it.

“Hyundai Engineering and Construction Co. Ltd claims that they have nothing to do with the money because they did not borrow it through the decision of the board of the directors,” said a creditor. “Taking advantage of a paper company is simple on the paper, so they seem to have made use of the company as a means of money transfer to the North.”

Lee Keun-young, Chairman of the Financial Supervisory Commission (FSC), made clear at the National Assembly`s audit and inspection of state affairs in November last year that as a result of reviewing the report on the operation of Hyundai Electronics, it was confirmed that the subsidiary in England lent the money to Hyundai Al Khafajy Co. in Dubai and amortized it.

In the meantime, Hannuri, a law firm taking charge of the complaint for the minority shareholders by the People`s Solidarity for Participatory Democracy, said, “ If the minority shareholders of Hyundai Merchant Marine Co, Ltd., which transferred 2 million dollars to the North, bring the case, we will help examine into the case and deal with the complaint of the shareholders.”

“The lawsuit by the shareholders is possible when the money transfer to the North was not the normal decision of the management for the benefit of Hyundai Merchant Marine Co, Ltd. and the company proved to be damaged,” said Kim Joo-young, a lawyer of the firm.