'Unfair Support and Embezzlement of Affiliates' Former Chairman Park Sam-gu Sentenced to 10 Years in Prison in Second Trial

The prosecution has requested a 10-year prison sentence in the second trial for former Kumho Asiana Group Chairman Park Sam-gu, who was indicted on charges of unfairly supporting his private company by mobilizing affiliates and embezzling company funds worth around 300 billion won.

On the 21st, the prosecution made this request to the court during the appellate trial sentencing hearing for former Chairman Park’s case involving violations of the Fair Trade Act and embezzlement and breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes, held by the Criminal Division 2 of the Seoul High Court (Presiding Judges Lee Won-beom, Han Ki-soo, Nam Woo-hyun). Three former executives, including the former head and managing director of the Group’s Management Strategy Office, who were also tried together, were sentenced to 3 to 5 years in prison, and Kumho Construction Co., Ltd., indicted for violating the Fair Trade Act, was fined 200 million won.

Park Sam-gu, former chairman of Kumho Asiana Group, is attending a trial on the 14th at the Seoul Central District Court in Seocho-gu, Seoul, on charges of unfair support to affiliates. Photo by Kang Jin-hyung aymsdream@

The prosecution stated, "The defendants committed the crimes meticulously and systematically to secure the controlling rights of the family group, resulting in losses worth several hundred billion won to Asiana Airlines. If Asiana Airlines cannot repay this, a tax amounting to 3.42 trillion won will inevitably be injected. They must be severely punished," explaining the reason for the sentencing request.

In his final statement, former Chairman Park said, "All the matters mentioned in the trial occurred during the process of deliberating with executives and employees on how to rebuild the group, which was on the brink of collapse," and appealed, "I feel extremely unfair about the first trial’s judgment, which accepted the prosecutor’s claims of massive breach of trust and embezzlement as they are."

Former Chairman Park was arrested and indicted in May 2021 on charges of embezzling affiliate funds and committing various illegal acts to rebuild the group and regain management rights.

He is accused of withdrawing 330 billion won from four affiliates, including Kumho Terminal, in December 2015 to pay for the acquisition of Kumho Industrial shares held by creditors such as the Korea Development Bank, and of selling 100% of Kumho Terminal shares held by Asiana Airlines to Kumho Enterprise at a low price in April the following year. In December 2016, he is also accused of selling Asiana Airlines’ exclusive in-flight meal business rights to Swiss Gate Group at a low price of 133.3 billion won and, in return, arranging for the Gate Group to acquire 160 billion won worth of Kumho Enterprise’s new convertible bonds (BW) interest-free.

The first trial court recognized most of the charges as guilty and sentenced former Chairman Park to 10 years in prison, the same as the prosecution’s requested sentence.

The sentencing for former Chairman Park and the others is scheduled for January 25 next year.

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