SEOUL, The chief of tire giant Hankook Tire & Technology Co. was arrested Thursday on charges of illicit inter-affiliate trading, embezzlement and breach of trust.
The Seoul Central District Court granted a warrant to arrest Hankook Tire Chairman Cho Hyun-bum after holding a court hearing the previous day, citing concerns he could destroy evidence.
The 51-year-old is under investigation for allegedly inflicting financial losses on MKT, an affiliate of Hankook Tire, by forcing it to lend around 13 billion won (US$9.84 million) between 2020 and 2021 to financially ailing automobile parts maker Leehan Corp., with whose chief Cho had close ties.
Cho is also suspected of funneling corporate funds worth billions of won for personal use, including the purchase of high-end imported cars and home repairs.
Prosecutors suspect the amount of Cho's embezzlement and breach of trust reaches over 20 billion won.
The chairman also faces charges that he had his company buy tire molds from MKT at an overpriced rate from 2014 to 2017 in violation of the fair trade law that prohibits illicit inter-affiliate trading.
The profits, prosecutors believe, may have gone to Cho and his family.
Source: Yonhap News Agency