Hyundai chairwoman's aide slapped with overseas travel ban

The prosecution has banned the CEO of a communications company from leaving the country on suspicion that he helped create slush funds for Hyundai Group, sources said Thursday.

The Seoul Central District Prosecutors' Office has investigated the 51-year-old businessman since March for allegedly creating $3.4 million of slush funds while executing contracts of Hyundai Merchant Marine (HMM) in the U.S.

The CEO was also accused of illegally intervening in the management of Hyundai Securities, deeply involving in a deal to increase the capital of the brokerage's Singapore unit. The trade union of the company filed a complaint with the prosecution against him in March.

"He is a close aide of Group Chairwoman Hyun Jeong-eun. They came to know each other since 2009, and he has intervened in management of affiliates since then on the back of Hyun," said Jeong Yong-nam, vice chairwoman of the trade union of Hyundai Securities.

Jeong argued that the executive is suspected of reaping illicit gains from the deal to increase the capital of the company's Singapore unit.

The union leader also said that he arranged the group's key deals through his company.

The prosecution is reviewing HMM's financial documents which it seized from the National Tax Service.

The tax authorities conducted a tax audit on the company last year, and imposed 3 billion won of back taxes and fines over the company's trades with its U.S. affiliate, which the CEO allegedly was associated with.

Representatives of the communications company and Hyundai Group were not available for comment.

The CEO was also suspected of taking profits by managing loan business of Hyundai Savings Bank.

Earlier this year, the Financial Supervisory Service filed a complaint with the prosecution against Hyundai Savings, accusing the company of paying high interests to a loan company he runs.