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Posted : 2012-03-04 18:43
Updated : 2012-03-04 18:43

Himart CEO faces summons this week


Seon Jong-koo
By Na Jeong-ju

The prosecution said Sunday it will issue a summons for Seon Jong-koo, CEO of the country’s largest electronics retailer Himart, this week over allegations that he misappropriated company funds and evaded taxes.

Seon, the firm’s second largest shareholder, is suspected of having used affiliates, in which his family members are major shareholders, to set up a slush fund amounting to some 100 billion won. He also reportedly moved assets abroad without reporting it to tax authorities.

Investigators raided the headquarters of the affiliates and other business partners on Saturday to secure evidence, a prosecutor told reporters.

“Through the raid, we obtained accounting books and computer hard disks that can verify irregular transactions between Himart and its affiliates,” the prosecutor said. “The action is based on a tip that Himart stashed funds through fake deals and by inflating prices of products. During the planned questioning, we will investigate these allegations.”

Seon is said to have been deeply involved in a golf resort development project, in which several affiliates also invested at the request of the 65-year-old CEO.

Prosecutors made it clear that the probe wouldn’t target Eugene Corp., a construction company and the largest shareholder of Himart.

There is also no indication that politicians or bureaucrats were bribed.

Seon and Eugene CEO Yoo Kyun-seon have feuded over the rights to manage Himart since Yoo took over the electronics retailer in 2007. Eugene has a 31 percent stake, while Seon has 28 percent and the remainder is owned by financial and individual investors.

Eugene had sought to sell its stake, but the sale was suspended as the investigation was launched. The prosecution has said the probe into Himart was based on a report by the Korea Financial Intelligence Unit, which monitors money laundering and financial scams at local companies.

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