Prosecutors seek arrest warrant for former chief of Daewoo Shipbuilding

Prosecutors said Wednesday that they have requested a warrant to arrest a former head of Daewoo Shipbuilding & Marine Engineering Co. on charges of fraud and breach of trust.

Prosecutors suspected that Ko Jae-ho cooked books worth some

5.4 trillion won (US$4.6 billion) from 2012 to 2014 by under-reporting the production cost or exaggerating sales or operating profit.

Earlier this year the shipyard said it swung to huge losses in 2013 and 2014 from earlier reported profits, citing accounting mishaps.

Still, Ko denied the allegations to reporters before entering the Seoul Central District Prosecutors‘ Office in southern Seoul for questioning about the embattled shipbuilder.

Last month, Ko’s predecessor, Nam Sang-tae, was detained on charges of embezzlement.

The Board of Audit and Inspection, the country‘s state auditor, has said the shipyard is suspected of rigging its books to hide up to 1.5 trillion won in losses between 2013 and 2014.

Daewoo Shipbuilding & Marine Engineering, along with two other major South Korean shipbuilders, are currently undergoing self-created debt-restructuring plans in the face of a decrease in new orders caused by the protracted global economic slump. (Yonhap)