Prosecutors to summon SK chairman

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Prosecutors to summon SK chairman

Prosecutors will summon the chairman of SK Group, the nation’s third-largest conglomerate, on suspicions that he embezzled nearly 100 billion won ($88.4 million) of company money in collusion with his younger brother, sources said Tuesday.

The summons for Chairman Chey Tae-won could take place as early as this week, although prosecutors have yet to decide exactly when to call him in for questioning, the sources said.

The plan was disclosed following prosecutors’ 16-hour interrogation last week of Chey Jae-won, the chairman’s younger brother and vice chairman.

The brothers, sons of founder Chey Jong-hyon, are facing allegations that they misappropriated the funds, which were part of a total of 280 billion won that had been set aside by 18 SK affiliates for investment purposes.

The embezzled funds were reportedly used to make up for as much as 300 billion won in losses incurred from 51-year-old Chairman Chey’s unsuccessful stock futures investments.

The younger brother is suspected of leading the embezzlement scheme.

The vice chairman reportedly refuted the embezzlement accusations during his interrogation last week, but prosecutors are said to have secured evidence suggesting the two brothers’ illegal use of the affiliates’ funds.

Prosecutors could possibly issue another summons for the younger brother for further questioning, the sources also said.

In 2003, Chairman Chey was accused of accounting fraud and illegal acquisition of his firm’s own stocks in a bid to block hostile foreign takeover attempts. He was convicted of the charges and sentenced in 2005 to a three-year prison term, suspended for five years.

SK Group controls dozens of affiliates in various industrial segments, including SK Innovation and SK Telecom.

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