The family of Yoo Byung-eun, the late operator of the sunken ferry Sewol, must repay Korea Deposit Insurance Corp. 19 billion won ($16.7 million), a New York state court ruled in November, court records showed Wednesday.
The court took side with South Korea’s state-run KDIC, which filed a lawsuit against family members of Yoo, the late chairman of Chonghaejin Marine, to take responsibility for his unpaid debt from the financial crisis in 1997.
KDIC redirected the blame to Yoo’s second-eldest son Yoo Hyuk-ki and daughter Yoo Sang-na, following the chairman’s death in July 2014. Yoo was hunted by authorities following the Sewol accident that left more than 300 dead or missing, but he was found dead in a field in Suncheon, South Jeolla Province.
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(Yonhap) |
Yoo borrowed a total of 220 billion won from various financial institutions after Semo Group, the now-defunct predecessor of Chonghaejin Marine, went bankrupt in 1997. KDIC compensated the creditors in his place after Yoo claimed he was incapable of repaying his debts.
KDIC billed a total of 14.7 billion won to Yoo, including interest, but the former Semo chairman only repaid 650 million won before declaring bankruptcy. He signed a debit note pledging to pay off his debt and 14 billion won was written off upon the request.
However, prosecutors found that Yoo had been hiding assets worth more than 1 billion won under borrowed names, including his children, through an in-depth probe involving the Sewol ferry disaster. The KDIC has been pursuing debt recovery since, which eventually led to a lawsuit against Yoo’s two children through the US legal system in 2015.
The court ruling is a summary judgment which does not grant KDIC full authority over the amount owed. The state-run institution will have to take further legal steps to fully recollect its debt.
Meanwhile, KDIC expects Yoo’s two children to file an appeal.
“Yoo Hyuk-ki and Yoo Sang-na hired A-list attorneys to represent them at the summary court and they’re expected to file an appeal,” said a spokesperson for KDIC.
Yoo Byung-eun and members of his family have been implicated in the sinking of the Sewol, due to their alleged mismanagement of Chonghaejin Marine and disregard for safety.
By Jung Min-kyung (
mkjung@heraldcorp.com)
