Court: "Hyanggun Sangjohoe's Profit Business Not Subject to Veterans Affairs Management and Supervision"

[Asia Economy Reporter Seongpil Cho] The court has ruled that the profit-making businesses of the funeral service association under the Korea Veterans Association (Hyanggun) are not subject to the management and supervision of the Ministry of Patriots and Veterans Affairs.

According to the legal community on the 17th, the Seoul Administrative Court Administrative Division 5 (Presiding Judge Park Yang-jun) partially ruled in favor of the plaintiff in a lawsuit filed by Hyanggun against the Minister of Patriots and Veterans Affairs, seeking cancellation of the disposition following a special audit.

The court stated, "It should be interpreted that the provisions of the Korea Veterans Association Act do not apply to the operation of profit-making businesses by subsidiaries established and invested in by the Korea Veterans Association," and added, "The Ministry of Patriots and Veterans Affairs' disposition is an illegal and unjust corrective measure carried out without any legal basis."

In 2018, the Ministry of Patriots and Veterans Affairs conducted an audit on Hyanggun and subsequently revoked the approval for profit-making businesses related to the Funeral Culture Center and Sangjo Tour operated by Hyangjo Sanghoe.

Hyangjo Sanghoe is an organization wholly owned (100% stake) by Hyanggun. Nevertheless, the reason given was that new businesses were promoted or expanded without going through the review and resolution of Hyanggun's Welfare Business Deliberation Committee.

In response, Hyanggun filed a lawsuit, arguing that "requesting corrective measures for businesses not directly operated by the Korea Veterans Association is an excessive interference by the Ministry of Patriots and Veterans Affairs into subsidiary operations and is therefore unjust."

Meanwhile, earlier this year, Hyangjo Sanghoe was sold to a consortium led by Kim Bong-hyun (currently detained), chairman of Star Mobility, who was identified as the mastermind behind the Lime Asset Management scandal, before being transferred to another funeral service company.

The prosecution is currently investigating Kim and others on charges including embezzlement of hundreds of billions of won in assets belonging to Hyanggun Sanghoe during this process.

This content was produced with the assistance of AI translation services.