Prosecutors Summon Choi Sun-won, SK Networks Chairman, on Suspicion of Slush Fund Creation
[Asia Economy Reporter Baek Kyunghwan] Choi Sin-won, chairman of SK Networks, who is suspected of creating slush funds, appeared before the prosecution. Chairman Choi is the second son of Choi Jong-gun, the founder of SK Group, and is a cousin of Choi Tae-won, chairman of SK Group.
According to the legal community on the 7th, the Anti-Corruption Investigation Division 1 of the Seoul Central District Prosecutors' Office (Chief Prosecutor Jeon Jun-cheol) summoned Chairman Choi as a suspect for questioning this morning. This comes three months after a search and seizure of SK Networks headquarters and Chairman Choi’s residence in October last year.
The prosecution detected signs that SK Networks created slush funds from some of its internal funds and embezzled company money, leading to a forced investigation. The prosecution believes Chairman Choi mobilized affiliates to create slush funds and transferred them overseas. The Financial Intelligence Unit (FIU) detected suspicious fund flows amounting to around 20 billion KRW at SK Networks in 2018 and handed over related information to the prosecution.
This case was initially investigated by the Fair Trade Investigation Division of the Seoul Central District Prosecutors' Office through account tracing and other inquiries, but was reassigned to the Anti-Corruption Investigation Division 1 in the second half of last year. Since then, the prosecution has registered Chairman Choi on charges including embezzlement under the Act on the Aggravated Punishment of Specific Economic Crimes and has been verifying whether he formed slush funds by mobilizing affiliates and transferred them overseas.
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Search and seizure operations were also conducted. In October last year, the prosecution searched more than 10 locations including SK Networks to secure accounting documents, and subsequently summoned and investigated executives and employees of affiliates such as SKC and SK Telesys multiple times.
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