Nam Hyun-woo has worked as a staff writer at The Korea Times since 2013, mostly covering business and politics. He currently belongs to the Business Desk where he covers topics such as emerging tech, AI, ICT and Korea's chaebol community. Prior to joining the team, he was the paper's correspondent for the presidential office of Korea during the Yoon Suk Yeol and Moon Jae-in administrations.
15-year prison term sought for Kakao head Kim Beom-su
Kakao founder Kim Beom-su enters the Seoul Southern District Court in Yangcheon District, Seoul, Friday. Yonhap
By Nam Hyun-woo
Prosecution on Friday sought a 15-year prison term for Kakao founder Kim Beom-su for allegedly attempting to manipulate the price of SM Entertainment’s stock in February 2023, during Kakao’s acquisition of the K-pop management agency.
During a hearing session at Seoul Southern District Court, prosecutors sought the prison term and 500 million won ($360,000) in fines for Kim, under suspicion for ordering Kakao Group executives to manipulate SM Entertainment’s stock price to sway the outcome of a bidding race against HYBE.
The prosecution argued that Kim, as the head of Kakao Group and its ultimate decision-maker, continued to oppose lawful competitive methods and was ‘‘the ultimate beneficiary of the criminal proceeds.”
Kim was arrested in July last year and indicted the following month, but was released on bail in October for health reasons. In March this year, he stepped down from Kakao’s top decision-making council. At the time, Kakao did not disclose his condition, but it was reported that he is suffering from bladder cancer.
Under the Capital Markets Act, crimes such as stock price manipulation that undermine market fairness are punished based on the amount of unjust gains. If the gains are assessed at more than 30 billion won, the basic sentence ranges from seven to 11 years in prison.
However, when the crime has a significant impact on stock prices, involves large-scale unfair trading or employs malicious methods, the sentence can be increased to up to 15 years, indicating that prosecutors regard the offense as a serious crime.
Kakao is currently led by CEO and Corporate Alignment Council Chair Chung Shin-a, but Kim remains the largest shareholder of the internet and communications conglomerate, holding a 24.12 percent stake together with his affiliates.