Prosecutors Raid Uam Construction Over Alleged Embezzlement in Hankook Tire Contract Project

The prosecution investigating the breach of trust case involving Cho Hyun-bum, chairman of Hankook Tire & Technology (Hankook Tire), has detected evidence of damages caused to the company through unfair construction orders and has launched a forced investigation into Uam Construction.

[Image source=Yonhap News]

The Fair Trade Investigation Division of the Seoul Central District Prosecutors' Office (Chief Prosecutor Lee Jeong-seop) is securing documents by sending prosecutors and investigators to the offices of Uam Construction and its affiliates on the 29th in relation to the breach of trust case involving construction orders from Hankook Tire.

The prosecution is known to have confirmed signs of unfair transactions between Hankook Tire and Uam Construction recently and proceeded with a search and seizure. During this search, they are expected to secure materials related to the transaction details, circumstances, and cash flow between the two parties. After analyzing the seized items, the prosecution plans to investigate the related parties and review whether to file additional charges against Chairman Cho.

Earlier, the prosecution indicted Chairman Cho on the 27th on charges including unfair support to affiliates, embezzlement, and breach of trust.

Chairman Cho is accused of being involved in the process of unfairly supporting Hankook Tire when it purchased tire molds worth approximately 87.5 billion KRW from its affiliate Hankook Precision Works (MKT) between 2014 and 2017 by buying at prices higher than other manufacturers. Through this, Hankook Tire reportedly suffered a loss of about 13.1 billion KRW.

The prosecution has been investigating on the grounds that the profits funneled to MKT by Hankook Tire flowed into the hands of Chairman Cho and his family. MKT’s shares are held as follows: Hankook Tire 50.1%, Chairman Cho 29.9%, and his brother Cho Hyun-sik, advisor of Hankook & Company, 20.0%.

Additionally, Chairman Cho is also suspected of using company funds between 2017 and 2022 to purchase or lease furniture for his residence and foreign cars. The prosecution has identified the amount embezzled and breached of trust by Chairman Cho to be approximately 7.55 billion KRW.

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