SEOUL, April 15 (Yonhap) — Park Sam-koo, former chairman of Kumho Asiana Group, was questioned by prosecutors on Thursday over allegations of unfair transactions among group affiliates during his chairmanship.
According to officials at the Seoul Central District Prosecutors Office, Park appeared before prosecutors around 9 a.m. as a suspect in their investigation into the group’s suspected inter-affiliate financial deals that allegedly resulted in huge gains for the former chairman and his family.
The 76-year-old Park resigned as chairman of Kumho Asiana Group and its affiliate Asiana Airlines in 2019 to take responsibility for controversial bookkeeping for the nation’s No. 2 carrier.
Park is accused of unfairly mobilizing Asiana Airlines and other group companies to support Kumho Buslines, a leading provider of bus and freight transportation services that was controlled by him and his family.
The charges against him were revealed last year in an investigation by the antitrust watchdog Korea Fair Trade Commission (KFTC).
According to the KFTC, Kumho Asiana Group signed an exclusive contract with Swiss airline caterer Gategroup in late 2016 to provide in-flight meals for Asiana. Then the Swiss company acquired 160 billion won (US$143 million) worth of bonds with warrants issued by Kumho Buslines with a zero rate of interest, resulting in the Kumho company earning 16.2 billion won in profits, the KFTC said.
As Kumho Buslines’ financial condition further deteriorated, nine group companies, including Kumho Industrial Co., lent a total of 130.6 billion won in 45 installments without security to the transportation provider at an interest rate of 1.5 to 4.5 percent, which was lower than the normal interest rate of 3.49 to 5.75 percent.
The KFTC concluded that Kumho Buslines earned about 16.9 billion won in gains from the interest rate gaps, while Park and his family pocketed at least 7.7 billion won in profits and 250 million won in dividends.
The KFTC then imposed a 32 billion won fine on the group and reported Park and two group executives to the prosecution for criminal investigations.
Prosecutors raided the group’s headquarters in Seoul last November and arrested a former group executive and a KFTC official for allegedly conspiring to delete documents unfavorable to the company.
Prosecutors plan to decide soon whether to request an arrest warrant for Park after completing questioning of him and other suspects.
Kumho Asiana has said that all the contracts and deals involving Swiss company Gategroup and group affiliates were conducted normally and didn’t result in any illegal profits for relevant shareholders.