Kumho Petrochemical hit by bribery scandal

By Lee Hyo-sik

Park Chan-koo, Kumho Petrochemical Chairman

Kumho Petrochemical, headed by Chairman Park Chan-koo, has been hit by a bribery scandal involving seven former and current employees.

According to the Seoul Metropolitan Police Agency, Tuesday, investigators arrested a 45-year-old man, surnamed Park, who allegedly offered bribes to six employees at one of the country’s largest chemical product makers from 2007 to 2014.

Police detained four Kumho workers for allegedly accepting money from Park, while booking two other employees without detention.

According to investigators, Park, who had worked at Kumho Petrochemical from 2000 to 2005, set up a supply firm in 2007 and began selling raw materials for synthetic resin to the company. He allegedly bribed his former coworkers, asking them to disqualify competing suppliers.

Park was also allegedly found to have established 10 paper companies to make it look like he won a supply contract in an open competition.

Police said he offered a total of 2.5 billion won in bribes to six Kumho workers and reaped 260 billion won in illicit gains from a supply deal with Kumho from 2007 through 2014. The four individuals taken into custody received between 300 million won and 600 million won from Park during the eight-year period, police said.

On Monday, the Seoul Central District Court issued arrest warrants for Park and the four individuals, saying that they might destroy evidence and flee the country to evade the arrest.

In June, Kumho Petrochemical filed a complaint with the police against the six employees, accusing them of taking bribes from a supplier.

The company was separated from Kumho Asiana in 2010, following an internal feud between Chairman Park and his elder brother Sam-koo, the chairman of Kumho Asiana Group.

The two siblings have been engaged in a series of legal battles, blaming each other for the group’s fall from grace. The group fell into crisis after it borrowed an excessive amount of money to acquire Daewoo Engineering & Construction and Korea Express in the late 2000s.

For instance, Chan-koo asked the court to strip his elder brother of the latter’s influence over Asiana Airlines, the country’s second-largest flagship carrier.

Kumho Industrial, the de facto holding firm of Kumho Asiana Group, which holds a 30.1 percent share in the carrier, and other shareholders appointed Sam-koo as the company CEO in March 2014.

But Kumho Petrochemical, which has 12.61 percent, opposed the appointment.

The two siblings also clashed over the use of the Asiana trademark and other matters.