South Korean prosecutors seek 10-year jail sentence for Lotte Group founder

Lotte Group founder Shin Kyuk Ho was charged with embezzlement, tax evasion, and fiduciary breaches amounting to about 224 billion won.
Lotte Group founder Shin Kyuk Ho was charged with embezzlement, tax evasion, and fiduciary breaches amounting to about 224 billion won.PHOTO: EPA-EFE

SEOUL (BLOOMBERG) - South Korean prosecutors have sought a 10-year prison sentence for Lotte Group founder Shin Kyuk Ho on charges including embezzlement and tax evasion, days after asking a Seoul court to hand jail terms to his sons in a corruption trial into the scandal-plagued retail giant.

Prosecutors also sought a 300 billion won (S$366.39 million) fine for the 95-year-old Lotte patriarch on Wednesday (Nov 1), said a prosecutor who asked not to be identified in line with internal policy.

Founder Shin was charged with embezzlement, tax evasion, and fiduciary breaches amounting to about 224 billion won. Lotte confirmed the requests and representatives for Shin declined to comment.

On Monday, prosecutors demanded a 10-year prison term for Lotte Group Chairman Shin Dong Bin, along with a five-year jail term for his elder brother. 

Shin family members were indicted in October 2016 for financial crimes amounting to hundreds of billions of won, following a four-month investigation into Lotte. A verdict is scheduled on Dec 22.

Five defendants in the Lotte case are now facing a total of 753 billion won in fines.

Shin Dong Bin also faces a bribery charge in a separate trial related to a presidential scandal that also led to a five-year sentence for Samsung scion Jay Y. Lee and the imprisonment of former president Park Geun Hye.

Lee's sentence, while less severe than the 12-year jail term prosecutors sought, was one of the harshest sentences for a chaebol leader.

South Korea's fifth-largest conglomerate has been suffering from series of scandals since 2015, when a family feud erupted into public view after the chairman's older brother led a failed boardroom coup in Tokyo, where Lotte was founded decades earlier.

Since then, Lotte has faced intensifying regulatory scrutiny and investigations, which led cancellations of a potential US$4.5 billion (S$6.12 billion) IPO of a hotel unit and a bid for chemicals-maker Axiall Corp last year.