S. Korea's 3rd-largest business group chairman questioned

  • Business
  • Wednesday, 05 Mar 2003

SEOUL, South Korea (AP) - Prosecutors on Wednesday questioned the chairman of South Korea's third-largest business group about an illegal stock transaction. 

Investigators want to know whether SK Group Chairman Son Kil-seung was involved in the alleged illegal swapping of stocks by the firm's head, Chey Tae-won, to increase his control of the group. 

Chey is accused of swapping his stock in the Sheraton-Walker Hill hotel in Seoul with stock that another SK subsidiary owns in SK Corp., which serves as the holding company of the group's affiliates. 

He was arrested late last month and charged. 

South Korean President Roh Moo-hyun has vowed to eliminate illegal trading that South Korea's leading families often use to strengthen their control of their business empires. 

On Tuesday, the government said it will investigate South Korea's six largest business groups amid signs of possible illegal transactions among subsidiaries. 

Samsung, LG, SK, and three groups that had formerly constituted Hyundai, will be subject to the probe by the Fair Trade Commission, which will scrutinize their practices from January 2000 to December 2002. 

The conglomerates, or chaebols as they are known locally, were the main driving force of South Korea's economic prosperity. 

But the country's troubles during the 1997-98 Asian financial crisis was blamed largely on the firms' unbridled expansion. - AP 

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