Prosecutors Raid Samhyo Group Chairman's Office Over Alleged Unfair Support for Eldest Son's Company
Searches Conducted at Residences of Current and Former Executives, Including Chairman, on the 26th
Prosecutors have launched a compulsory investigation into Samhyo Group Chairman Chung Do-won and others, on suspicion of providing unfair support to a "second-generation owner" company by purchasing ready-mixed concrete raw materials at inflated prices.
On May 26, the Fair Trade Investigation Division of the Seoul Central District Prosecutors' Office conducted searches and seizures at the residences of former and current executives, including Chairman Chung, as well as at Samhyo Industry, on charges including breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes.
Prosecutors suspect that Chairman Chung, through Samhyo Industry, purchased products from SP Nature?a ready-mixed concrete raw materials company in which his eldest son, Vice Chairman Chung Dae-hyun, is the largest shareholder?at prices higher than market value, thereby conferring approximately 7.5 billion won in unfair profits from 2016 to 2019.
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After the Fair Trade Commission (FTC) filed a complaint, prosecutors began investigating the allegations and conducted searches and seizures at more than 10 locations, including Samhyo Group’s headquarters and SP Nature. Subsequently, Samhyo Industry and former CEO Hong Seong-won were indicted without detention on charges of violating the Fair Trade Act. Even after bringing Hong and others to trial, prosecutors continued their investigation, believing that suspicions of breach of trust and other offenses remained concerning the owner family.
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