Kakao Mobility reappoints CEO despite watchdog recommendation

This photo provided by Kakao Mobility Corp. shows its CEO Ryu Geung-seon. [YONHAP]

Kakao Mobility, Korea's top taxi-hailing service operator, said Wednesday it has reappointed its CEO for another year, despite the state financial watchdog's recommendation to replace him amid allegations of accounting fraud.

In a general shareholders' meeting, Kakao Mobility voted to keep Ryu Geung-seon as its CEO for one more year, citing the necessity for consistent leadership in the face of ongoing challenges.

The move came as the Financial Supervisory Service (FSS) has imposed a combined 9 billion-won (US$6.68 million) fine on the company on charges of inflating its sales and recommended Ryu step down from his position.

The punishment will be finalized at a panel meeting of the state financial regulator.

Kakao Mobility has been working to restructure its membership system amid public blame for unfair practices using its market dominance in running its sprawling ride-hailing platform, Kakao T.

Its parent company, Kakao, has also been at the center of public criticism since last year over suspicions of unfair business practices and the moral hazard of its executives, including stock manipulation allegations.

Yonhap