Ferry owner’s home raided

Prosecutors raided the home of Yoo Byung-eun, owner of Chonghaejin Marine, and the offices of a dozen affiliates of the ferry firm, Wednesday.

The raid was part of an escalating investigation into the Yoo family after the Chonghaejin ferry Sewol sank off the country’s southwestern coast, leaving 157 dead and 145 others missing as of 11 p.m.

Yoo, 73, who reportedly owns 13 firms, including Chonghaejin Marine, through a dubious ownership structure, is suspected of evading taxes, illegal currency trading, illegal transfer of wealth to his two sons, coercion, bribery and other violations.

“This morning, we sent a team of prosecutors to search and seize accounting and other documents from Chonghaejin and its affiliates after receiving a confiscation warrant (from the Incheon District Court),” a spokesman at the Incheon District Prosecutors’ Office told The Korea Times by telephone.

The spokesman said the homes of Yoo’s two sons, Dae-gyun 44 and Hyuk-gi 42, were also raided as part of the investigation.

“We are looking into whether the Yoo family and their companies are involved in any business-related wrongdoings. The confiscation is part of a broad investigation into possible malfeasance at Chonghaejin and its 13 domestic affiliates including I-One-I Holdings, Chonhaeji, Ahae Press and Semo,” the spokesman said asking not to be named.

I-One-I is the holding company of Chonghaejin affiliates. Ahae Press is a paint company and Semo sells health foods. Chonhaiji, the vessel block company, owns a 39.4 percent stake in Chonghaejin, followed by Chonghaejin President Kim Han-sik with 11.6 percent and I-One-I with 7.1 percent. The Yoo brothers collectively own a controlling 38.9 percent stake in I-One-I.

Last week, the Ministry of Justice banned Yoo and Kim from traveling overseas. As of Wednesday, 30 executives of the 13 subsidiaries have also been banned from leaving the country, according to the Supreme Prosecutors’ Office.

Prosecutors reportedly launched the probe as Yoo and his family are suspected of embezzlement, breach of duty and tax evasion. They say mismanagement resulted in the deadly accident.

Yoo Byeong-eun ran Semo Group, the operator of cruise ships on the Han River a decade ago. But the company went bankrupt in 1997 after failing to pay debts worth 200 billion won, according to local reports.

Currently, Yoo and his family have a stake in 13 domestic companies and another 13 overseas affiliates. Overall assets of the 26 companies reach 560 billion won. Moreover, they own assets reaching at least 240 billion won at home and abroad.

They have at least 50 billion won worth of buildings in the affluent Gangnam area and a luxury house worth nearly $1 million in Los Angeles. Yoo’s second son Hyeok-ki is known to have a mansion in New York and an apartment in Manhattan, reports said.

The spokesman didn’t confirm this or elaborate on the matter.

The National Tax Service has launched a probe into whether there were any attempts to evade taxes by Chonghaejin companies and the Yoo family, a person familiar with the matter told The Korea Times.

“At least four Chonghaejin affiliates are being looked into by the tax agency. Also, the Korea Customs Service is looking into past export and import records of Chonghaejin as there may be illegal foreign-currency transactions,” the person said.

In an unresolved incident in 1987, Yoo was involved in loan sharking, a religious cult and a mass suicide.

He was put behind bars for four years after being found guilty of embezzlement. Investigators failed to find any link between Yoo and the mass suicide. By Choi Kyong-ae The korea times

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