After Two Months of Pardon... Former Taekwang Chairman Lee Hojin Under Forced Investigation for 'Slush Fund Formation' (Comprehensive)

The police have launched a forced investigation into former Taekwang Group Chairman Lee Hojin, who is accused of embezzling and breaching trust involving billions of won. Although Lee was pardoned only two months ago, he has come under investigation on suspicion of creating slush funds by paying false salaries through employee accounts.

[Image source=Yonhap News]

According to the police on the 24th, the Anti-Corruption and Public Crime Investigation Unit of the Seoul Metropolitan Police Agency has been conducting a search and seizure since the morning at Lee’s residence, the Taekwang Group Management Council office located in the Heungkuk Life Insurance Building in Gwanghwamun, Seoul, and Taekwang CC located in Yongin, Gyeonggi Province. The police are securing documents and electronic files to prove Lee’s charges through the search and seizure. However, it has been confirmed that Heungkuk Life Insurance is not subject to the search and seizure.

Lee is reportedly suspected of creating slush funds exceeding 2 billion won through Taekwang Group affiliates. Although executives of affiliates are not allowed to hold concurrent positions, there are suspicions that he received double salaries from two companies and embezzled the funds. Additionally, there are allegations that unfair construction costs were supported to affiliates through Taekwang CC.

Lee was pardoned as a special amnesty on Liberation Day this August but has become a subject of investigation again within two months. In 2011, Lee was arrested and prosecuted on charges of embezzling 42.1 billion won and evading corporate tax of about 900 million won through "undocumented transactions" by manipulating the scale of textile products produced by Taekwang Industrial. Due to health reasons, he was tried without detention but was arrested in 2018 following criticism of his "emperor bail." In 2019, Lee was sentenced to three years in prison and was released after serving his term in October 2021. Under the Act on the Aggravated Punishment of Specific Economic Crimes and the Act on the Governance of Financial Companies, Lee was prohibited from working for related companies for five years, until October 2026, but the pardon allowed him to return to management.

A Taekwang Group official stated, "We are actively cooperating with the police’s search and seizure of Taekwang Group and its affiliates," and added, "We will sincerely cooperate with the police investigation to resolve the allegations raised."

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