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KT&G CEO nominee under investigation
By Kim Se-jeong
Baek Bok-in
By Kim Se-jeong
Prosecutors said Wednesday that they are investigating Baek Bok-in, CEO nominee of KT&G, for his alleged involvement in the company’s slush fund scandal and other corruption.
The news came less than two weeks after Baek, now vice president, was nominated to head the company.
Former CEO Min Young-jin stepped down at the end of July amid an investigation into allegations that he had created slush funds through the company’s affiliates.
A shareholders’ meeting is scheduled for Oct. 7 to confirm Baek’s nomination, and it remains to be seen whether the shareholders will approve his new position.
Prosecutors said they are reinvestigating the allegations that Min, Baek and other executives of the company paid too much to a subcontractor that helped KT&G develop land near Namdaemun in central Seoul.
Earlier in 2013, the prosecution investigated the allegation that Baek forced the head of the subcontractor to give false testimony to investigators and then helped him flee overseas. At that time, the prosecutors’ request for an arrest warrant against Baek was rejected, and the charge was later dropped due to a lack of evidence.
The prosecution also said it is again looking into the company’s bribery case of 2010 to review his possible involvement.
It was alleged that an official at the Cheongju city government, North Chungcheong Province, took 300 million won in kickbacks from a real estate agent who was helping KT&G with the sale of its land there to the city government. The official allegedly made the city government purchase the land at the price suggested by the company in return for the bribe.
Assuming that KT&G was the source of the money, the prosecution raided the firm’s offices and questioned executives including Baek, but dropped the charges against them.
The prosecution said it is reviewing Baek’s bank account transactions but did not reveal anything further.
Regarding the probe, KT&G officials said Baek was already cleared of the allegations that he was involved in the creation of the slush fund.
Several other executives of KT&G have been involved in corruption allegations.
Earlier last month, the prosecution also indicted the company’s former vice president, surnamed Lee, on charges of taking money from partner companies in exchange for keeping business contracts.
Former CEO Min quit amid allegations that he created a slush fund amounting to billions of won through inter-subsidiary deals since he became the head of the company in 2010. Prosecutors are investigating suspicions of embezzlement and breach of trust.