Lotte chairman and 23 other parties indicted

SEOUL • South Korean prosecutors said yesterday they have indicted 22 current and former officials of Lotte Group including chairman Shin Dong Bin, as well as two entire group companies, concluding a corruption probe at the country's fifth- largest conglomerate.

It marks the end of an investigation during which billion-dollar deals involving Lotte collapsed. Business at the retail-to-chemicals group is now expected to normalise, though those indicted are likely to undergo months-long trials.

The Seoul Central District Prosecutors' Office said it indicted Shin and other members of Lotte's owner-family, as well as present and past executives and employees, plus Lotte Home Shopping and Lotte Engineering & Construction during the probe which became public in June.

Shin has been charged with embezzlement of about 50.8 billion won (S$62 million), and breach of trust involving about 124.9 billion won for perceived involvement in irregular payments to family members and unlawful support of group companies.

"We will clearly explain the issues that the prosecution deems problematic," a Lotte Group spokesman told Reuters.

Shin is the latest head of a chaebol - family-run business groups that dominate Asia's fourth-largest economy - to be charged over corporate crimes. Past cases involved the leaders of Samsung, Hyundai Motor and SK groups.

The Seoul Central District Court turned down prosecutors' request last month for an arrest warrant for Shin after he appeared at a court hearing, saying it did not view detention as necessary.

Though indicted, Shin has not been detained and, like all defendants, is presumed innocent unless a court rules otherwise. So he can continue running Lotte Group and its 103 trillion won worth of assets.

Lotte had been preparing a US$4.5 billion (S$6.2 billion) initial public offering of Hotel Lotte Co, but shelved the plan after the investigation became public.

REUTERS

A version of this article appeared in the print edition of The Straits Times on October 20, 2016, with the headline 'Lotte chairman and 23 other parties indicted'. Print Edition | Subscribe