'Embezzlement and Breach of Trust' Charges Against Chairman Jo Hyun-beom's Side: "Ferrari and Porsche Also Used for Testing"

Cho Hyun-beom, chairman of Hankook Tire & Technology (51), who has been indicted on charges of embezzlement, breach of trust, and unfair support of affiliates, admitted that he personally used some of the Ferraris and Porsches purchased with company funds, but argued that this cannot be entirely regarded as breach of trust.

Chairman Cho Hyun-beom of Hankook Tire & Technology, suspected of unfair support to affiliates and embezzlement and breach of trust [Photo by Yonhap News]

On the 21st, the Criminal Division 23 of the Seoul Central District Court (Presiding Judge Jo Byung-gu) held a trial session for Chairman Cho, who was indicted on charges of unfair support of affiliates, embezzlement, and breach of trust.

Regarding the allegations that Chairman Cho purchased or leased five high-end foreign cars including a Ferrari 488, Porsche Taycan, Porsche 911 Targa, and Tesla Model X under the company’s name and used them privately, his side stated, "We acknowledge that some company-owned test vehicles were used privately, but it is difficult to conclude that the entire amount constitutes breach of trust." They claimed that according to management philosophy, the vehicles were mainly used for development and marketing purposes.

They also disclosed the acquisition process of the affiliate Hankook Precision Works (MKT), which was alleged to have been unfairly supported by Chairman Cho for personal gain, and refuted the charges. They explained that Hankook Tire decided to acquire MKT as a management decision to prevent the leakage of core technology and sudden refusal of transactions. Regarding the allegation of lending 5 billion KRW to MKT without collateral, they argued, "We believed there would be no loss, and in fact, it was repaid with interest, so it is not breach of trust."

On the other hand, the prosecution holds that Hankook Tire acquired MKT in 2011 and incorporated it as an affiliate, during which Chairman Cho secured a 29.9% stake in the company, and from February 2014 to December 2017, unfairly supported approximately 13.1 billion KRW by purchasing tire molds at inflated prices worth 87.5 billion KRW.

Chairman Cho’s side admitted and expressed remorse for the private use of corporate credit cards by himself, family, and acquaintances, but argued that the charge should be breach of trust, not embezzlement as prosecuted. Regarding payments for moving and furniture purchases for his private residence with company funds, they stated, "We learned about this belatedly during the investigation and have repaid all amounts."

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