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Booyoung Group chairman summoned over tax evasion and embezzlement charges

2018.02.01 15:48:43 | 2018.02.01 17:12:29
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Lee Joong-keun, Booyoung Group chairman

Lee Joong-keun, Booyoung Group chairman

Lee Joong-keun, chairman of South Korea’s mid-sized conglomerate Booyoung Group Co., was summoned to the prosecution Wednesday morning to be questioned over tax evasion and embezzlement charges.

Booyoung Group is a mid-sized constructor with its business focusing mainly on building and leasing apartments. The group has been embroiled in alleged corruption activities since tax authority, fair trade agency and progressive civic group Citizens’ Coalition for Economic Justice accused Lee of dodging millions of dollars in tax.

Lee, who finally appeared for the questioning on Wednesday after failing to respond to summons a couple of times, is suspected of having stacked away more than 10 billion won ($9 million) in slush funds through a paper company set up under his relative’s name.

Prosecutors are also looking into suspicions that he broke fair trade laws and dodged taxes by favoring family-owned affiliates and paying salaries to family members who exist as employees only on paper. Lee and his company are also suspected of making unfair profits out of new home sales by inflating construction costs.

Prosecutors reportedly estimate that Booyoung has unlawfully pocketed more than 1 trillion won based on the group’s internal documents they seized during investigation and the Supreme Court’s precedents.

Lee is the second chaebol group chief to be called in for prosecutors’ questioning since liberal President Moon Jae-in took office last year. President Moon has vowed to reform family-run chaebol conglomerates that have long been criticized for abusing their power as a large company and often hinder fair competition in the market. Last month, industrial conglomerate Hyosung Group’s Chairman Cho Hyun-joon was also summoned to the prosecution over embezzlement and corruption charges.

By Chu Dong-hun and Cho Jeehyun

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]

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