Go to contents

`Tour Company CEO Contacted Tax Officials on Taekwang`

Posted May. 11, 2009 03:04,   


Prosecutors yesterday said they found circumstantial evidence that Sejoong Namo Tour Chairman Chun Shin-il contacted tax officials after an audit began on Taekwang Industry July 30 last year.

Chun is alleged to have contacted tax officials, including then head of the National Tax Service Han Sang-ryule, because Chun had close personal relations with Taekwang Chairman Park Yeon-cha and was given huge economic benefits from Park for several years.

Prosecutors confirmed that Chun sold Sejoong stock worth more than 30 billion won (24.1 million U.S. dollars) owned by himself and his family to Park’s acquaintances between April and November 2007.

At that time, Park’s acquaintances purchased the stock at 6,000 (4.82 U.S. dollars) to 12,000 won (9.63 U.S. dollars) per share, and they bought all of them on several occasions in after-hour trading to evade the rule on reporting the acquisition of a large volume of shares.

Chun’s son bought shares at 2,000 (1.61 dollars) to 4,000 won (3.22 dollars) each, far cheaper than the market sale price, in October last year, when the tax audit on Park was underway. Prosecutors said that if Chun colluded with Park to transfer shares to his son, he could face charges of transfer tax evasion.

If Chun sold shares at high prices thanks to Park’s help and repurchased them cheaper, he could be charged with dodging the capital gains tax resulting from share trading by a majority stakeholder.

Prosecutors said Chun probably received additional valuables in return for his influence-peddling to halt the tax audit on Park, on top of 20 million won (16,100 dollars) in Chinese yuan that Chun admitted to taking from Park when he was attending the Beijing Olympics in August last year as the chairman of the Korea Wrestling Association.

Investigators are also seeing if Chun bribed third parties, including politicians, while contacting tax officials. Prosecutors have reportedly secured records of phone calls between Chun and Han.

In a related development, former First Lady Kwon Yang-sook submitted via e-mail Saturday where she used the million dollars she received through Jung Sang-moon, former senior presidential secretary for general affairs, from Park in June 2007.

“I transferred 400,000 dollars to my son Gun-ho and daughter Jung-yeon while they were studying in the United States, and handed over 200,000 dollars to them in Korea,” she wrote.

Kwon also said she used the remaining 400,000 dollars to pay off personal debts, but stopped short of specifying whom she repaid.

Senior prosecutor Hong Man-pyo said, “We`ll have to delay the summons of former First Lady Kwon because we have additional things to confirm on where she spent the million dollars,” adding, “The decision to indict former President Roh (Moo-hyun) could not come by the end of this week.”

needjung@donga.com dnsp@donga.com