Hyundai chief handed 3-year suspended sentence
South Korea’s high court on Tuesday gave Hyundai Motor Group chief Chung Mong-koo a suspended three-year sentence for fraud, duplicating an earlier ruling and keeping him out of jail despite pressure to crack down hard on corruption at the country’s top firms.
The ruling could fan a long-running debate on the powerful and controversial “chaebol”, the family-run conglomerates which opponents say have been given kid-glove treatment because of their importance to Asia’s fourth-largest economy.
But the decision not to jail one of the country’s richest men ended concerns over a potential management vacuum at the world’s sixth biggest auto maker, which faces cut-throat competition in overseas markets and a consumption slowdown at home.
The sentence also comes less than two months after the chairman of Samsung Group announced he would leave the helm of the country’s biggest conglomerate after being indicted on charges of tax evasion and breach of trust payday loans.
“(Chung) did embezzle a large sum of money, but it was mostly used in running the business, not for personal purposes,” Kil Ki-bong, the presiding judge at the Seoul High Court, said while handing down the sentence.
After the ruling, shares in Hyundai Motor (005380.KS: Quote, Profile, Research) closed down 4.92 percent to the day’s low of 79,300 won.
In April, the country’s Supreme Court threw out an initial suspended three-year jail sentence handed to Chung in 2007, saying some of an appeal court’s orders were unlawful and sending it back to a lower court for review.
Prosecutors had sought a jail sentence of 6 years.
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