Corp-Ethics.com - Report: Prosecutors seek Hyundai arrest

Company	Hyundai [Company Info]
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Date	Issue	Title
27th Apr 2006	Other Issue	Prosecutors seek Hyundai arrest

Report

South Korean prosecutors have asked for an arrest warrant for Chung Mong-koo, head of the Hyundai motor group, on embezzlement charges.

He is at the centre of allegations of illegal political lobbying.

The car giant is suspected of creating a slush fund to pay politicians and officials for business favours.

Prosecutors said they also planned to indict his son, Chung Eui-sun, president of Hyundai subsidiary Kia Motors, although without detaining him.

The Hyundai group has been under investigation since March, over suspicion that it sought to buy political favours by channelling cash through third parties to figures in the government.

Prosecutors have already raided the offices of Hyundai Automotive Group - South Korea's top carmaker - and three affiliate companies, and questioned key officials about the scandal.

Two lobbyists have also been arrested on suspicion of receiving money from the company, although it is unclear whether they actually sought to pay government officials.

The request for an arrest warrant came just days after Mr Chung spent about 15 hours being questioned at the Supreme Prosecutors' Office in Seoul.

Senior prosecutor Chae Dong-Wook is quoted as telling a press briefing on Thursday that Mr Chung was wanted on charges "of raising some 100 billion won ($106m) in slush funds and embezzling it".

Shares in Hyundai plunged 3% on the news that prosecutors were seeking Mr Chung's arrest, according the French news agency AFP.

Hyundai spokesman Jake Jang admitted that news of the warrant was "shocking".

"Hyundai executives are all in a panic. The absence of Chairman Chung is enormous, and its ramifications are beyond description," he told the Associated Press.

Other Reports on Hyundai
Date	Issue	Company	Report
5th Feb 2007	Fraud Investigation	Hyundai	Hyundai's boss gets three years
13th Jun 2006	Fraud Investigation	Hyundai	Hyundai chief admits fraud
16th May 2006	Other Issue	Hyundai	Hyundai chairman Chung indicted
28th Apr 2006	Other Issue	Hyundai	Hyundai boss arrested in South Korea
24th Apr 2006	Other Issue	Hyundai	Hyundai chief faces prosecutors
19th Apr 2006	Other Issue	Hyundai	Hyundai apologises amid scandal
28th Mar 2006	Fraud Investigation	Hyundai	Hyundai chief faces fraud probe

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