Sewol owner’s son gets three years in jail

The Incheon District Court on Wednesday sentenced the late ferry owner Yoo Byung-eun’s eldest son Yoo Dae-kyoon to three years in prison for embezzlement and breach of trust.

Dae-kyoon, 44, was indicted on Aug. 12 on charges of pocketing company funds worth 7.39 billion won ($6.79 million) at seven units of Chonghaejin Marine Co., the operator of the sunken Sewol, between May 2002 and December 2013.

The court also handed down a four-year prison term for the deceased’s Yoo’s formerly close confidante Byun Ki-choon for incurring huge losses to major units of Chonghaejin Marine Co., the operator of Sewol, via embezzlement.

In its ruling, the court acknowledged the charges raised by the prosecution that Byun, as the chief of Chonhaiji, the core unit of Chonghaejin Marine, pocketed company funds.

In addition, the court handed down prison terms of several years or suspended terms for Yoo’s other key aides and two brothers.

His younger brother, Yoo Byung-ho, was sentenced to two years in prison for charges of embezzlement. Along with some relatives and Kwon Yoon-ja, the widow of Yoo Byung-eun, the 62-year-old brother has been indicted for embezzling about a billion won from Chonghaejin Marine’s sister firms or subsidiaries.

Koh Chang-hwan, the former CEO of the now-defunct Semo Group (the predecessor of Cheonghaejin Marine) was given a three-year jail term for similar charges. Oh Kyung-seok, chief of Hemato-Centric Life Foundation, a Cheonghaejin unit, was also sentenced to three years.

Six more aides and Yoo’s older brother were given suspended prison terms of from 18 to 30 months with a three-year probation. They were Song Kook-bin, Park Seung-il, Lee Jae-young, Lee Kang-se, Kim Dong-hwan, Jeon Yang-ja and Yoo Byung-il.

Investigators have looked into the allegation that Yoo and his close confidants stashed away assets of Semo Group after intentionally causing the group to become financially insolvent in 1997, and then buying back core subsidiaries including automobile and shipbuilding firms.

Some have raised the allegation that ex-senior policymakers or lawmakers could also have been implicated in the group management’s repurchasing of assets.

There are speculations that the former Semo Group had cozy relations with former President Chun Doo-hwan, who took power in a coup in 1979.

Yoo and his benefactors have also been suspected of offering kickbacks to financial regulatory officials in exchange for garnering financial firms’ approval of huge loans.

Financial authorities had said that commercial banks and other secondary financial firms issued combined loans worth 400 billion won to Chonghaejin Marine and dozens of its units.

Further, there are allegations that Yoo had sought influence in the process of revising the nation’s shipping act.

Chonghaejin Marine Co. was established in 1999 to replace Semo Marine Co., then the flagship unit of Semo.

In late August, a funeral ceremony was held for Yoo at Geumsuwon, the Salvation Sect’s religious compound in Anseong, Gyeonggi Province, after he was found dead in a southern port city on June 12.

Yoo’s burial has made it difficult to determine the cause of his death and retrieve the illicit wealth of his family and confidants. They are presumed to be responsible for the sinking disaster due to their alleged mismanagement of Chonghaejin Marine and lack of attention to vessel safety.

By Kim Yon-se (kys@heraldcorp.com)