PAGODA Academy CEO found guilty of embezzlement, breach of trust

By Lee Han-soo, Park Si-soo

Park Kyung-sil

PAGODA Academy CEO Park Kyung-sil was found guilty of embezzlement and breach of trust, an appellate court said Tuesday.

The Seoul High Court sentenced the 61-year-old leader of Korea’s major foreign language institute to two-years-and-six months in prison with the term suspended for three years.

The ruling was made after the court reviewed the case at the request of the Supreme Court, which found faults with the grounds for the appellate court’s ruling.

Park was indicted in 2013 on charges of pocketing one billion won ($849,000) in corporate money and inflicting losses of 53 billion won on the company by mismanagement. She pled guilty to the embezzlement charge.

“The seriousness of the crimes committed by the accused was proven to be lighter than claimed. Also she recovered the losses caused by her mismanagement,” presiding Judge Lee Won-hyong said, recognizing her responsibility for the mismanagement.

Prosecutors claim she inflicted the loss by making the academy share the burden of repaying 23.1 billion debt of her daughter’s company, Pagoda Tower Jongro ― the daughter’s company failed to fully repay the debt.

A PAGODA spokeswoman did not say whether the CEO will appeal the ruling. “We will make a decision after reviewing the ruling with her lawyer,” the spokeswoman said.

Ko In-kyung, Park's ex-husband, founded PAGODA Academy in 1983 and grew it into one of the biggest foreign language institutes in Korea.

PAGODA reported 56.7 billion won in revenue in 2015, down from 57.5 billion won year-on-year. Its net profit for 2015 shrank to 44.1 billion won from 59.4 billion won in 2014. The decline could be blamed on intensifying competition with its rivals, along with managerial problems caused by the CEO’s involvement in the litigation, said market observers.