Former Taekwang Chairman Lee Hojin Summoned Again by Prosecutors over Slush Fund Allegations

Former Taekwang Group Chairman Lee Ho-jin was summoned by prosecutors on May 27 on charges of creating slush funds by mobilizing affiliates. The Criminal Division 3 of the Seoul Central District Prosecutors' Office (Chief Prosecutor Choi Soonho) announced that Lee was summoned as a suspect and was being questioned that afternoon.

According to the prosecution, Lee is accused of embezzling tens of billions of won in slush funds by using funds from Taekwang Group affiliates, paying false salaries, and utilizing employee accounts. He is also suspected of having affiliates pay 860 million won in construction costs for the Taekwang CC golf practice range and of using about 80 million won worth of corporate credit cards for personal expenses. This case emerged in September of last year when the Seoul Metropolitan Police Agency's Anti-Corruption Investigation Unit referred Lee without detention on charges of embezzlement and breach of trust under the Act on the Aggravated Punishment of Specific Economic Crimes. In May of the same year, the police had requested an arrest warrant for Lee, but the court dismissed it, stating that there was insufficient reason and necessity for detention. Lee was previously indicted and detained in 2011 for embezzling 42.1 billion won in company funds and evading 930 million won in corporate taxes, and his three-year prison sentence was finalized in 2019. He was released in October 2021 after serving his full term. Prosecutors are reportedly focusing their questioning on the circumstances of the slush fund creation order, the methods used to mobilize affiliates, and the use of the funds.

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