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Hyosung Group Chairman Cho Hyun-joon/Courtesy of Hyosung Group

Hyosung accused of paying $35 million for tycoons’ suits

Hyosung paid around 40 billion won ($34.8 million) in legal fees to lawyers defending Chairman Cho Hyun-joon and his father Honorary Chairman Cho Suck-rae, according to a Korean terrestrial TV network.

SBS recently reported that the mid-tier group paid a total of 30.7 billion won ($26.7 million) to lawyers and law firms from 2013 when prosecutors started looking into the two tycoons on various charges.

Of the total, around two thirds went to Kim & Chang, the country’s biggest law firm, while the remainder went to other outfits that typically employ former senior prosecutors, it said.

In addition, SBS said that Hyosung subsidiaries contributed 10 billion won ($8.69 million) to cover the lawsuits.

This is in line with recent reports that police are investigating these and other suspicions.

Hyosung Group officials have repeatedly said that the two Cho’s did not use company funds to pay for legal services, arguing that the pair spent more than 20 million won ($17.4 million) of their own money.

In 2016, A Seoul district court sentenced Chairman Cho to a suspended 18-month prison term after finding him guilty of embezzling around $1.5 million by using corporate credit cards for personal use.

In 2018, a Seoul appellate court upheld the lower court’s verdict, and the case is currently pending at the Supreme Court.

It remains to be seen how the top court will decide on the case. Depending on the ruling, the 51-year-old scion still runs the risk of being on the wrong side of the bars.

Watchers expect that such a possibility is not high. But Chairman Cho faces another legal battle involving his own younger brother of former Hyosung Vice President Cho Hyun-moon.

The younger Cho filed many suits against his elder brother on charges of embezzlement and breach of trust. The case is currently pending at a Seoul district court.

In particular, he claims that Chairman Cho created a slush fund from an art money fund set up in the late 2000s.

 

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