KT in hot seat over embezzlement allegation

By Kang Seung-woo

KT, still in hot water over its alleged illegal donations to lawmakers, is faced with a fresh allegation that its executives pocketed money returned from the politicians.

KT Chairman Hwang Chang-gyu

Raising the suspicion, the telecom company's new union and the civic group Vampire Capital Hunter have also requested the prosecution to investigate the alleged embezzlement.

“Since investigations were launched by police and the prosecution last year, some lawmakers have returned all or part of the donations to KT executives, some of whom lined their pockets instead of turning in the money to the company,” the union said.

“In addition, some senior officials belatedly returned the money, which is apparently embezzlement, as well.”

It also claimed that despite the alleged embezzlement by its executives, Chairman Hwang Chang-gyu has yet to take any punitive action against them, implying he is behind the illegal acts.

The claim came after police requested the prosecution to indict seven executives including Hwang in January, saying KT was suspected of creating a 1.15 billion won ($1.03 million) slush fund from May 2014 to October 2017 and spending 442 million won of the money on illegal donations to 99 lawmakers.

The donations were given to lawmakers who belonged to a National Assembly committee in charge of telecommunications, apparently to seek their favor in KT's businesses including its bid to start a internet-only bank.

The Political Fund Law bans registered firms or groups from donating any funds to lawmakers. Donations made with company money are also forbidden.

In this regard, the KT officials allegedly donated the money under other people's names or those of their relatives.

Some of the 99 lawmakers returned the money immediately after receiving it, while others began to return it after the police investigation started. The lawmakers sent the money back through the bank accounts of the individual executives, but some of the executives have pocketed the money, according to the union.

“This constitutes embezzlement, and thorough investigation is needed into this allegation,” the union said in its complaint to the prosecution.

In response to the claim, KT declined to comment, citing the case is under prosecution investigation.