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Corruption Charges Held In Court, Lotte Founder, Chairman Convicted

Corruption Charges Held In Court, Lotte Founder, Chairman Convicted
The Lotte Group chairman and his son barely escaped jail even though they were convicted on corruption charges on Friday.
Sources among the court officials conformed that the 95 year old age factor of founder Shin Kyuk-ho was behind an arrest warrant not being issued against him despite the Seoul Central District Court sentencing him to four years in prison.
The sources also said that sentence for two years was suspended by the court for his son and chairman Shin Dong-bin and instead passed a 20-month prison term. He has been allowed to stay free under the condition that no laws are broken by him for two years.
According to the court, one week’s time is available to both the Shins and the prosecutors.
Embezzlement, tax evasion and other charges were placed against Shin Kyuk-ho, his mistress and all three of his children including Shin Dong-bin earlier by prosecutors.
Charges of embezzlement of $46 million of company funds and evasion of a total of $76 million in taxes were placed against all of the five accused. $123 million of losses for Lotte companies was also the result of the actions of the Shin family members who attempted to exert their influence and control corporate funds as well as influence decisions that were in their favor instead of beig in favor of the shareholders, the prosecutors said.
There has been a series of setbacks for Lotte which is significantly present in Japan and Southeast Asia and is amongst the largest conglomerates of South Korea.
Last year, even as the regulatory and investigating authorities were probing the company, the vice chairman of the company was found dead in what was described as a suicide apparently. And even earlier, following the demotion of founder Shin Kyuk-ho to a position of virtual powerlessness, there was large family feud related to his successor.
The company also came under fire in China after one of its facilities – a golf course, in South Korea was allowed by the company to be used for the deployment of an argumentative but complex U.S. missile defense system. Its business in China suffered due to this decision because it was perceived to be a threat by China. The company had said then that after violations of fire safety standards were apparently found by Chinese authorities in dozens of Lotte Mart discount stores in China during surprise inspections, all of the indicted stores had to be shut down for a month each.
The chewing gum company by Lotte was set up in 1948 in Japan. chemicals, food, shopping and hotels are the businesses that the conglomerate now engages in. South Korea's largest discount and department store chains are also run by it. Its brands are well recognized across Asia.

Christopher J. Mitchell

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