Lotte Shopping CEO grilled over bribery

The former head of Lotte Homeshopping was questioned on Monday for allegedly receiving billions of won in cash kickbacks from local subcontractors.

Shin Heon, 60, who led the retail arm of the country’s fifth-largest conglomerate Lotte Group between 2008 and 2012, was summoned by prosecutors at the Seoul Central District Prosecutors’ Office as a suspect in the large-scale corruption case.

Shin reportedly claimed his innocence, saying he has never demanded a bribe. He currently serves as CEO of Lotte Shopping, another retail subsidiary of the group.

Allegations against Shin came under the spotlight earlier this year when prosecutors launched a probe into the firm’s alleged kickback scheme involving former and incumbent Lotte Homeshopping executives.

Sources have also raised the possibility of the prosecution linking his suspected crimes with attempts to create slush funds.

The prosecution has already arrested five officials on charges of receiving hundreds of millions of won from suppliers that sold products on the retailer’s TV network.

Prosecutors said they would request a preliminary arrest warrant based on Monday’s investigation with Shin.

The practice of receiving bribes from vendors is common in the local industry, according to officials working in the retail sector. They claim that it helps secure sales and distribution channels, which are prime factors in increasing sales.

By Suk Gee-hyun (monicasuk@heraldcorp.com)