Lotte Group vice chairman kills himself amid corruption probe targeting group founder, chairman

By Park Si-soo

Lotte Group Vice Chairman Lee In-won, widely known as the group's No. 2 man and the closest aide to Chairman Shin Dong-bin, was found dead on a walking trail in Gyeonggi Province in an apparent suicide, police said Friday morning.

Lee, 69, was found hanging from a tree on the walking trail in Yangpyeong, Gyeonggi Province, at 7:10 a.m., with his belongings, including his ID card, in his pocket. A suicide note was found in a car parked nearby, police said.

He was supposed to appear at the Seoul Central District Prosecutors' Office at 9 a.m. to be questioned over allegations that group founder Shin Kyuk-ho and Chairman Shin Dong-bin have amassed massive slush funds and committed other crimes. The two have been banned from leaving the country since early July.

In the note, Lee called the chairman a "good person" and wrote he "feels sorry for leaving early." He said "there are no slush funds in Lotte." Police did not elaborate.

Lotte Group said it is "trying to confirm the matter."

Lee joined Lotte, the fifth-biggest business empire in Korea, in 1973 and has worked closely with group founder Shin Kyuk-ho and Chairman Shin Dong-bin for many years.

Meanwhile, the prosecution said it had found the chairman and the founder have received a total of 30 billion won every year from the group's affiliates. While Lotte officials claim the money is dividends and paychecks, prosecutors believe part of the money came from illicit financial transactions among affiliates.

It is also alleged that the group had some affiliates involved in other affiliates' business, especially in dealings with foreign companies, allowing them to profit. The group is also suspected of having set up paper companies when investing in China, Russia and Vietnam and creating slush funds.

Members of the owner family are also suspected of cooking the accounting books by exaggerating profits and unfairly helping their relatives' firms win bids for business contracts.

Shin Young-ja, the founder's eldest daughter, was arrested in early July for alleged bribery and embezzlement. She allegedly took 3 billion won from companies in return for placing their counters in favorable spots at Lotte's duty free shops, and embezzled 4 billion won in company funds by registering her three daughters as board members of a company owned by her son so they would receive salaries.

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