Prosecutors Summon KT CEO Koo Hyun-mo for 'Split Donations' Alleged via Gift Card Fraud

KT CEO Koo Hyun-mo is presenting KT Group's media content business strategy at KT Square in Jongno-gu, Seoul, on March 23./Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Choi Seok-jin] The prosecution investigating KT's alleged 'split donations' to members of the National Assembly is summoning KT CEO Koo Hyun-mo for questioning on the 4th.

The Economic Crime Division of the Seoul Central District Prosecutors' Office (Chief Prosecutor Joo Min-cheol) has summoned CEO Koo as a suspect and is questioning him from 9:30 a.m. today.

CEO Koo is accused of embezzlement and violating the Political Funds Act by creating slush funds totaling 437.9 million KRW over four years starting in 2014, along with former KT Chairman Hwang Chang-gyu, and providing illegal donations to 99 members of the 19th and 20th National Assembly.

Earlier, in January 2019, the police referred seven current and former KT executives, including former Chairman Hwang, to the prosecution with a recommendation for indictment on charges of embezzlement and violation of the Political Funds Act.

According to the police investigation, former Chairman Hwang and others used the names of executives, employees' family members, and acquaintances to circumvent the donation limit of 5 million KRW per person per year to members of the National Assembly under the Political Funds Act.

It was also revealed that they created slush funds through so-called 'gift certificate laundering,' where corporate funds were used to purchase gift certificates, which were then resold to convert into cash.

Under the Political Funds Act, individuals are limited to donating up to 5 million KRW per year to members of the National Assembly. Corporations or organizations are prohibited from donating political funds, and providing political funds using money related to corporations or organizations is also forbidden.

After receiving the case from the police, the prosecution conducted supplementary investigations, including a raid on KT's data center, but the investigation stalled last June due to the outbreak of the Optimus Asset Management fund fraud case.

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