Lotte founder’s dementia no good news for ongoing investigation

[THE INVESTOR] Shin Dong-joo-controlled SDJ Corp. said this week that that the 92-year-old Lotte founder Shin Kyuk-ho has been treated for dementia since 2010. 

Dong-joo is the oldest son of Shin, and he has been fighting for control over the 90-trillion won (US$ 76.67 billion) Lotte empire with his brother Shin Dong-bin, who is currently reigning as the Lotte Group chairman.

The latest announcement from SDJ cannot be good news for Dong-bin in terms of the ongoing investigation, as prosecutors may find reason to believe it was him, and not his father, who is responsible for the charges of embezzlement and other irregularities at Lotte.  

Observers therefore say the latest claims from Dong-joo may be a disguised attack on Dong-bin to weaken Lotte. 

However, Dong-joo's claims could also backfire, since his brother had seized control over Lotte based on the grounds that their father had been too senile and incapable of making a sound judgment when he allegedly named Dong-joo as his successor.

SDJ Corp. did say the Lotte founder was on medication for preventative purposes, but the drug he was using is Aricept, which is used to treat mild to moderate dementia caused by Alzheimer’s disease.

Questions are now surfacing as to how the senior Shin attained prescriptions for Aricept. Since Dong-joo took over his care last October, there are no records of his father visiting the hospital for a mental health diagnosis.

The Seoul Family Court is currently reviewing records and interviewing those close to Shin Kyuk-ho to determine his mental health at the request of Shin’s younger sister Jung-sook. The court battle over Shin Kyuk-ho’s mental state had even led to the founder being admitted to Seoul National University Hospital for a mental capacity evaluation. A decision on whether he needs a guardian is due out on Aug. 10.

Meanwhile, Dong-bin has already confirmed his leadership through three shareholders’ meetings at Lotte Holdings in Japan, the holding company of Lotte Group.

By Won Ho-jung (hjwon@heraldcorp.com)