Lotte chairman faces summons over slush fund
Lotte Group Chairman Shin Dong-bin gets into a car at Gimpo International Airport in western Seoul, Sunday, after returning from Japan. Shin, who left the country several days before the prosecution began an investigation into the group early this month, said he will fully cooperate with prosecutors. / Yonhap
Shin Dong-bin says he will fully cooperate with prosecution
By Lee Hyo-sik
Embattled Lotte Group Chairman Shin Dong-bin returned home Sunday, following a month-long overseas trip. He expressed regrets for causing concern over a host of allegations ranging from the creation of a slush fund to inter-subsidiary dealings and tax evasion.
Shin, who is expected to be summoned by the prosecution, said he will fully cooperate with prosecutors.
“I am sorry for causing grave concerns,” Shin told reporters at Gimpo International Airport in western Seoul, upon returning from Japan. “I will fully cooperate with the prosecution.”
The chairman also said he is not worried about his older brother Dong-joo’s attempts to take away control of Korea’s fifth-largest conglomerate from him.
He refused to comment on the health of his ailing father and group founder Kyuk-ho.
On June 7, three days before hundreds of investigators raided Lotte Group headquarters, offices of group affiliates and the chairman’s residence, Shin left the country for Mexico where he attended the annual meeting of the International Ski Federation.
He then went to the United States to take part in a ground breaking ceremony for Lotte Chemical’s joint plant with U.S. chemical firm Axiall.
The chairman then flew to Japan where he faced a no-confidence vote brought forward by his elder brother Dong-joo, a bitter rival for succession of the conglomerate.
On June 25, the chairman again defended his managerial control of Lotte operations both in Japan and Korea as the majority of Lotte Holdings shareholders continued to side with him.
Now back home, Shin is facing a range of daunting tasks. He first has to prop up his embattled empire whose operations have come to a virtual halt after a series of prosecution raids.
The chairman also faces summons to be questioned over a host of allegations against him and Lotte Group. He is suspected of mobilizing Lotte Chemical and other group units to raise slush funds, and orchestrating other illegal corporate activities to bolster his wealth.
After first summoning Shin’s confidants, including Lotte Shopping Vice Chairman Lee In-won, investigators will likely question Shin.
For his part, the chairman will closely consult with lawyers from Kim & Chang and other law firms, which will defend him and group executives in court, according to Lotte officials.
Last Friday, Shin’s older sister Young-ja, who holds board seats at eight Lotte units, was questioned for 16 hours over allegations that she took bribes, amounting to millions of dollars, from Jung Woon-ho, the former head of Nature Republic who has been jailed for committing a number of illicit acts.
The Lotte Foundation chairwoman allegedly took money in June in exchange for helping the cosmetics brand open shops at Lotte Duty Free stores.
Meanwhile, Dong-joo, former vice chairman of Lotte Holdings, who came to Korea from Japan last Thursday, has reportedly been preparing to file additional lawsuits against his younger brother.
On Friday, he visited his ailing father, who has been hospitalized at Asan Medical Center in eastern Seoul, to brief him on the outcome of Lotte Holding’s recent shareholders’ meeting.