SK Owner Is Going to Be Arraigned Today

The Criminal Division 9 of the Seoul District Public Prosecutors` Office has reportedly decided to indict SK group`s owner Choi Tae-won today on various counts including embezzlement. In the meanwhile, Choi reported to the DA`s Office yesterday for questioning.

A prosecutor in charge of the case confirmed yesterday, "It takes longer than we thought. We have to review many things, but our questioning is not progressing fast. We can possibly indict him tomorrow."

Choi reportedly plans to file for arraignment with the court. Thus, the court is expected to decide on his eligibility for bail as early as today.

The DA`s Office reportedly grilled Choi yesterday. Choi is suspected of swapping his Walker Hill Hotel shares with a much larger number of SK C&C`s SK Corporation shares in a commercially unbalanced way to strengthen his grip over the SK group. In addition, the DA`s Office wants to know what role he played in consummating a secret deal between SK Securities and JP Morgan.

According to the prosecution, Choi sold his Walker Hill shares at a price much higher than the market price, causing 70-80 billion worth of damage to SK C&C and SK Global. He also made SK affiliates sustain 180 billion worth of loss by cutting a secret deal between SK Securities and JP Morgan. For example, for the secret deal, SK Global reportedly sustained a damage amounting to 100 billion.

The DA`s Office plans to bring additional criminal charges against 3-4 SK executives, who are suspected of assisting Choi in conducting illegal internal transactions. Out of them, the office plans to indict without bail 1-2 core SK members who are suspected of playing active roles in strengthening Choi`s grip over the group.

The prosecution has also discovered that SK Global sold 1,000 SK Corporation shares it retained and deposited the proceeds into the overseas funds of Japan Asia and Emergent Capital. Thus, it is now scrutinizing the case to determine whether the disposition violated the law.

Sang-Rok Lee Tae-Hoon Lee myzodan@donga.com jefflee@donga.com