'140 Billion Accounting Fraud' Lee Sang-young, Chairman of Daewoo Industrial Development, Appears for Detention Hearing

Chairman Lee Sang-young and former CEO Han Jae-jun of Daewoo Industrial Development, who are accused of accounting fraud worth 100 billion KRW and embezzlement and breach of trust amounting to several tens of billions of KRW, appeared for detention hearings on the 29th.

Lee Sang-young, Chairman of Daewoo Industrial Development (left), and Han Jae-jun, former CEO of Daewoo Industrial Development, are heading to the courtroom on the morning of the 29th at the Seoul Central District Court in Seocho-gu, Seoul, to attend a warrant hearing related to charges including embezzlement, breach of trust, and fraud under the Act on the Aggravated Punishment of Specific Economic Crimes. [Image source=Yonhap News]

Yoo Chang-hoon, the chief judge in charge of warrants at the Seoul Central District Court, held the pre-trial detention hearing for Chairman Lee and former CEO Han at 10:30 a.m. that day. Chairman Lee responded to reporters' questions about "how he plans to prove the charges" during his court appearance by saying, "I will do well and come back." He remained silent when asked whether he acknowledged the charges and if he had any words for the employees of Daewoo Industrial Development. Former CEO Han, who appeared at the court together, said, "I am not particularly related to those matters," when asked if he had any words for the employees.

Earlier, the two are accused of falsifying and disclosing financial statements by underestimating allowance for doubtful accounts from 2016 to 2021, committing accounting fraud worth approximately 143 billion KRW (violation of the External Audit Act). They are also charged with fraud under the Act on the Aggravated Punishment of Specific Economic Crimes for obtaining loans totaling 47 billion KRW from seven financial institutions based on false financial statements from May 2018 to July last year. Additionally, they are accused of embezzling and breaching trust under the same act by using about 14 billion KRW of company funds for personal purposes and causing the company a loss of 51.8 billion KRW over roughly ten years from 2013 to last year.

Former CEO Han is charged with embezzling 12.2 billion KRW of company money and causing a loss of 3.1 billion KRW, while Chairman Lee is accused of forging and using documents to resign from the CEO position under former CEO Han’s name last September after their relationship deteriorated. The police applied for arrest warrants for them at the end of January, but the court dismissed the request. The Seoul Central District Prosecutors’ Office Tax Crime Investigation Division (Chief Prosecutor Min Kyung-ho), which took over the case, identified additional signs of accounting fraud involving hundreds of billions of KRW during supplementary investigations and re-applied for arrest warrants on the 24th.

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