Two major affiliates of Hyundai Group were slapped with a combined fine of 1.29 billion won ($1.1 million) for being involved in illegal business transactions to help their owner families gain more profits, the antitrust regulator said Sunday.
According to the Fair Trade Commission (FTC), Hyundai Securities, the third-largest brokerage house by asset here, allegedly arranged a deal to rent some 150 multi-function business printers from HTS from 2012, Hyundai Group's computer equipment supplying unit fully owned by the sister and brother-in-law of Hyun Jeong-eun, the group's chairwoman.
Hyundai Logistics, the country's second-biggest delivery service firm by market share, chose another owner relative-run company called 3B in 2012 and bought packing slips at prices that were some 45 percent higher than the market average.
The FTC said that through such illegal intra-affiliate deals, Hyundai Securities gave an extra 540 million won in profit and Hyundai Logistics granted 1.4 billion won to the group chairwoman's relatives.
"This is the first time that the FTC has imposed sanctions against large business group's illegal business trading for the sake of owner family's personal gains," said Jung Chang-wook, director of the anti-monopoly division at the FTC.
Local business groups, or chaebol in Korean, have been criticized for helping their owner families increase personal profits by funneling orders and contracts to subsidiaries owned by other family members or relatives.
Since the anti-trust law was revised to tighten punishments on such practices last year, the watchdog has launched an investigation into major business groups.
"We will keep close tabs on conglomerates' illegal insider trading and take a no-tolerance policy against them," said the FTC official.
Hyundai Logistics put up its packing slip deal for open auction in 2015 after the firm was taken over by Lotte Group in December 2014, the watchdog added. (Yonhap)