Arrest of CEO of Hapcheon Video Theme Park Operator for '25 Billion Won Embezzlement'

Gyeongnam Hapcheon Film Theme Park.
[Photo by Hapcheon Film Theme Park]

The CEO of the developer who absconded with 25 billion KRW for the hotel construction project at Hapcheon Video Theme Park in Gyeongnam has been apprehended by the police.

The Gyeongnam Provincial Police Agency's Metropolitan Investigation Unit announced on the 6th that they arrested the developer's CEO, Mr. A, at a motel in Daejeon around 12:30 AM on the 5th on charges of breach of trust and embezzlement.

According to the police, Mr. A is suspected of wrongfully withdrawing 25 billion KRW from the project funds for the hotel construction within Hapcheon Video Theme Park and then absconding in April.

The police are also investigating four other individuals related to the developer on the same charges.

The Hapcheon Video Theme Park hotel construction project involves building a hotel with 200 rooms and a total area of 7,336㎡ on a 1,607㎡ site within Yongju-myeon Video Theme Park.

The county and the developer signed an implementation agreement worth 59 billion KRW, under which the county provided the land free of charge, the developer would construct the hotel and donate it to the county, and the developer would hold the hotel operation rights for 20 years.

The construction was carried out with the developer investing 4 billion KRW and borrowing the remaining 55 billion KRW through real estate project financing (PF).

In March this year, when the developer requested an increase of 15 billion KRW in project funds citing a surge in material costs due to inflation, the county reviewed the validity of the increase and discovered excessive project expenditures.

When the county tried to confirm this by contacting Mr. A, it was found that he had absconded since April 19, taking about 25 billion KRW out of the 55 billion KRW loaned project funds and had been unreachable.

The county filed a complaint with the police against Mr. A and four other developer associates on charges of breach of trust, embezzlement, and violations of the Electronic Financial Transactions Act, and on the 20th declared abandonment of the project.

A police official stated, “We are conducting an investigation on Mr. A and plan to apply for an arrest warrant soon,” adding, “We cannot disclose detailed information as the matter is under investigation.”

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