FSS to conduct special probe into Hyosung Group; family of chairman Cho Seok-rae borrowed money from Hyosung Capital, a financial arm of the group, under borrowed names
October 23, 2013 Leave a comment
FSS to conduct special probe into Hyosung Group
2013.10.23 14:47:24
Hyosung Group, which was investigated by the Financial Supervisory Service (FSS) earlier this year, will be under another special probe on allegations that the family of chairman Cho Seok-rae borrowed money from Hyosung Capital, a financial arm of the group, under borrowed names. The FSS will launch a probe next month into Hyosung Capital on suspicions that chairman Cho Seok-rae’s family received several billion won loans from Hyosung Capital using borrowed names of corporate executives, according to a local news agency, Yonhap News Wednesday. Extending loans to the family of the owner did not infringe the relevant law, but FSS has apparently found some irregularities in Hyosung Capital`s loan approval procedure to the owners through its board and is considering restrictions against the group, according to the FSS’s probe on the financial unit of the group from April to May. Back then, the FSS did not investigate into whether the loans under the borrowed names were extended to the family, but this time, appointed a special prosecutor for the probe with rising suspicions. Meanwhile, Seoul Regional Tax Office filed a charge on September 30 against the conglomerate with the prosecution on allegations that the group raised slush funds by evading corporate tax through an accounting fraud worth one trillion won from 1997 and it did not pay taxes through management of borrowed-name assets.
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