'Hyeongryeong·Baeim Charges' Korea Tire's Cho Hyun-beom Faces Detention Decision Today

First Arrest Warrant for a Major Conglomerate Owner Under the Yoon Administration

On the 8th, Cho Hyun-bum, chairman of Hankook Tire & Technology (hereinafter Hankook Tire), will stand trial for detention in connection with allegations of unfair support and embezzlement and breach of trust involving affiliates worth around 20 billion won.

Cho, the grandson of the late Cho Hong-je, founder of the Hyosung Group, is the second son of former Hankook Tire chairman Cho Yang-rae. He is also the son-in-law of former President Lee Myung-bak.

Cho Hyun-bum, Chairman of Hankook Tire & Technology
[Photo by Yonhap News]

At 3:30 p.m. on the same day, Yoon Jae-nam, the presiding judge in charge of warrants at the Seoul Central District Court, will conduct a pre-trial detention hearing (warrant substantive examination) for Cho. The decision on whether to detain Cho is expected to be made late that night or early the next morning.

On the 6th, the Fair Trade Investigation Division of the Seoul Central District Prosecutors' Office (Chief Prosecutor Lee Jeong-seop) requested a pre-arrest warrant for Cho on charges including embezzlement and breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes, and violations of the Fair Trade Act.

At the time, a prosecution official explained the background for seeking Cho’s detention, stating, "Due to the strong pursuit of private interests, the severity of the crime is serious, and there are signs of evidence destruction." This is the first time since the launch of the Yoon Suk-yeol administration that a detention warrant has been requested for a conglomerate owner.

Cho is accused of causing damage to the company by lending about 13 billion won of affiliate Hankook Precision Works (MKT) funds to Park Ji-hoon, CEO of Hyundai Motor’s partner company Rihan, despite knowing that Rihan’s management situation was poor from 2020 to 2021, based on a personal friendship (breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes).

He is also accused of embezzling tens of millions of won of company money during a similar period, using it for personal home repairs and purchasing foreign cars (embezzlement under the Act on the Aggravated Punishment of Specific Economic Crimes).

The amount of embezzlement and breach of trust by Cho identified by the prosecution is known to reach the 20 billion won level.

Cho is also suspected of unfairly supporting MKT by having Hankook Tire purchase tire molds from MKT at prices higher than other manufacturers from 2014 to 2017 (violation of the Fair Trade Act). The prosecution believes that the profits funneled to MKT by Hankook Tire flowed into the hands of Cho and other members of the founding family.

MKT is a company in which Hankook Tire holds 50.1%, Cho holds 29.9%, and his older brother Cho Hyun-sik, an advisor at Hankook & Company, holds 20.0% of the shares. From 2016 to 2017, dividends totaling 10.8 billion won were paid, including 6.5 billion won to Cho and 4.3 billion won to the advisor Cho.

In December last year, the prosecution summoned Cho as a witness for investigation and requested the Fair Trade Commission to file charges against him. Subsequently, the prosecution conducted multiple searches of Hankook Tire headquarters, affiliates, and the residences of Cho and other related parties. Earlier this year, the prosecution indicted purchasing executive Jeong Mo and the company corporation without detention on charges of unfair support of affiliates.

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