Slush fund probe spreads to CJ E&M vice chairperson

CJ Entertainment & Media vice chairperson Lee Mi-kyung has been added to the list of CJ Group executives under investigation for allegedly establishing slush funds overseas as well as committing acts of tax evasion and fraud.

CJ E&M is the widely influential media content division of the food and media powerhouse, which is the country’s 14th-largest business conglomerate.

The affiliate is one of the driving forces behind hallyu and it remains to be seen what impact the current probe will have on its many projects, including the promotion of Korean entertainment content overseas.

The vice chairperson is the older sister of CJ Group chairman Lee Jay-hyun and daughter of Lee Maeng-hee, who is eldest son of Samsung Group founder Lee Byung-chull. She and her brothers Jay-hyun and Lee Jae-hwan ― who heads an independent advertising company ― are all currently being investigated by prosecutors and have been banned from leaving the country, along with six other company associates. The family is accused of establishing subsidiary companies in the British Virgin Islands in order to evade taxes and illegally gifting cash to family members without paying taxes.

The CJ-owned CGV movie theater franchise is the country’s largest theater franchise with 772 screens across the nation and has ranked No. 1 in movie revenues since 2003. CJ E&M has also been responsible for producing big budget local films as well as distributing some of Hollywood’s top films in Korea.

The 55-year-old Lee (also known as Miky Lee) is a Harvard graduate who made a name for herself in the global entertainment industry with her role in the co-establishment of DreamWorks Studios, with Jeffrey Katzenberg, Steven Spielberg and David Geffen. In 1995 she persuaded her family to invest $300 million in the movie studio and landed the Asian distribution rights to the studio’s films. The shares of DreamWorks Studios were divested and sold to Paramount Pictures in 2006.

She was a crucial part of the tremendous growth seen in the CJ Group’s entertainment sector and was one of the biggest driving forces in acquiring major investments in Korean film and TV.

Lee seemed to have the Midas touch, with several of CJ E&M movies such as “Joint Security Area” (2000) by Park Chan-wook, “Sympathy for Lady Vengeance” (2005) also by Park, and “Masquerade” (2012) by Chu Chang-min, enjoying huge box office success.

She is also a highly influential figure in the entertainment scene, attracting the loyalty and friendship of the country’s top stars. U.S. music producer Quincy Jones sang at her birthday party at her company headquarters attended by numerous local celebrities two years ago, and U.S. actress Jessica Alba was one of the many luminaries who attended a private party hosted by Mi-kyung.

By Julie Jackson (juliejackson@heraldcorp.com)