Park Jung-won |
By Kim Rahn
Staff Reporter
A scion of Doosan Group is likely to face questioning over alleged embezzlement and stock price manipulation.
The summons is part of an investigation into chaebol scions suspected of having reaped huge capital gains through irregular schemes.
Investigators Tuesday seized financial documents and computer files during a raid at New Wall Corp.'s office in southern Seoul. Park Jung-won, a fourth generation Doosan heir, was the company's president and the company's largest shareholder. He is a son of former Doosan Group Chairman Park Yong-oh.
The Doosan scion purchased 1.3 million shares of New Wall Corp., a Kosdaq-listed company, in March 2007 and took over management control. Stock prices jumped from 5,000 won to a high of 10,400 won per share. Park sold all the shares to lock in profits in December.
In September before the sale, the company filed public notices stating it would increase capital, saying Park would buy additional stocks worth 5 billion won ($4.8 million). However, Park left the firm after selling his shares, and the company reversed its capital increase plan, to the detriment of retail investors.
A prosecutor said they have secured evidence that the Doosan heir embezzled New Wall Corp.'s funds while president. They will soon call him in for questioning.
``We also suspect Park spread the rumor of capital increase to inflate stock prices, taking advantage of his position as a chaebol scion,'' the prosecutor said.
With the raid, the prosecution is intensifying its probe into alleged stock rigging by family members of conglomerates, who are mostly second or third generation heirs.
In a similar case, the prosecution last month arrested Koo Bon-ho, a cousin of LG Group Chairman Koo Bon-moo and the largest shareholder of Red Cap Tour.
Prosecutors suspect Koo, Park and other chaebol scions colluded with insiders at Kosdaq-listed firms to inflate stock prices by giving the false impression that they would take part in the management of the companies. Once retail investors rushed to invest in the stocks and the stock prices surged, they took gains, leaving retail investors burnt in their wake.
rahnita@koreatimes.co.kr
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